SBA Startup Loans


Hello this is Ty Crandall with Credit Suite and in this short video we’re going to dive in and talk a little bit more about SBA loans are available for start-up businesses so the most popular type of SBA loan as soon the 7(a) loan and this is popular because it’s for working capital which means you could use it for almost any purpose and you can actually get approved for $750,000 for SBA 7(a) loan but rates typically 2-4% above the prime interest rates, rates are pretty low, now all owners who own more than 20% of the business will need to provide a personal guarantee which also means the credit will be reviewed and you’re going to need to have really good consumer credit to get approved as a matter of fact SBA want you to have good personal credit good business credit and good bank credit, so even if you’re just getting started you going to need money in the bank, you’re going to need to be focusing on building your business credit as well as a consumer credit to get approved because 7(a) loans are not easy to get especially for start-up businesses and they also have low documentation program or low-doc programs we won’t need as much documentation as you do with a typical SBA loans. Now big banks that are proved to offer this also offer a loan call the SBA express so it’s the really the fastest way there you going to find to get an SBA loan and with this loan you can get as much quarter million dollars $250,000 and rates are the same as what we just talked about the 7(a) about 2-4 percent above prime and another program really come to goes with this is known as the community express, so this is a program that’s actually designed for low and moderate income entrepreneurs, so that might be something that fits with you also. Now there’s also the second most popular type of financing it’s out there with SBA’s as known itself 504 program, now this program unlike the 7(a) really has specific purposes so it’s usually used to purchase land, equipment or even a real estate versus the 7(a) that use typically for multiple purposes working capital, now what happens to this is a bank actually this is the way with almost all SBA loans the bank themself for the ones that fund the loan and basically SBA insurers so with the 504 SBA guarantees as much as 40% of that loan so if you ever default with the banks then SBA will cover 40% in the loss you get typically get loans up to a million dollars for this program and you’ve got to contribute 10% of the equity so what’s going to happen is you’re going to have to have some cash, collateral in the game to be able to get approved for a 504 loan now there’s also 7(m) or microloan to SBA and this is probably one of the most up incoming in popular type of SBA loans it’s out there today you can approved for up to 35 grand again to use for any purpose that you really see if that working capital and then the average loan amount about 10 grand so as you can imagine it’s much easier to get a $10,000 loan the $250,000 thousand dollar loan so these loans are just more streamlined easier to qualify for because it deal lower loan amounts and funds come directly from SBA unlike the 7(a) where funds come from the bank, this is a really big difference I mean almost all SBA loans the money comes from the bank SBA just guarantees that in case default they’ll cover a certain percentage 40% 50% 90% but this loans come directly from SBA so this gives you nice benefit because you don’t have to qualify with the bank and SBA like you do 7(a) loans you only have to get approved and qualify per SBA. So another really, really, really good solutions so those are really the main loans are available to SBA now don’t get me wrong there’s a lot of other start-up loans I mean a lot of other start-up loan options out there for you so if you like this video makes sure click the like it awesome also make sure you subscribe to our channel where we dig into a lot of other kinda financing is available out there for start-ups on some of the SBA a lot of it’s not to SBA. Okay so make sure you subscribe to get some info and also make sure you cook on this video cause were usually giving a easy way for you to know now how much you can qualify for financing of free resource guide that will help you get approved so again this is Ty thank you very much for taking the time to check this video I see you on our next video which will be dedicated to helping you get business credit and financing for your business.

One comment on “SBA Startup Loans”

  1. monster max says:

    Hello!; and thanks for the info. I have good credit but little money in the bank. I'm a veteran. Plus! I have a good idea on rental properties. I found one with 100% occupancy and it can make a pretty penny. I have a credit union that want's to back me, but I need 10% to make the deal go through. What should I do?

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