GROW YOUR BUSINESS AFFORDABLY
Small Business Administration
A loan from the U.S. Small Business Administration is the smartest and most affordable way to obtain financing for your small business.
SBA loans are partially guaranteed by the federal agency, which allows lenders to offer you flexible terms and low-interest rates.
Read on to find out if your business qualifies for an SBA 7a or a 504 loan.
What is a SBA loan?
A small business loan backed by the U.S Small Business Administration is the most affordable way to finance your business. With flexible terms and low-interest rates that are accessible to American business owners and entrepreneurs who have well-established businesses with strong credit history.
An SBA loan is a form of conventional financing that has very stringent requirements, which are partially guaranteed by the U.S. Small Business Administration, and are issued by authorized lenders such as Vander Ford Funding.
With these government-backed loan programs, the Small Business Administration is helping entrepreneurs, veterans, women, and minorities get easy access to lending opportunities by offering banks and private lenders a partial repayment in case the businesses defaults on their payments. Therefore, reducing the risk for lenders translates into flexible terms, low annual percentage rates (APR), low-interest, and low down payments for borrowers.
It is important to remember that the Small Business Administration doesn’t lend money directly to small business owners, instead, it sets guidelines for loans made by its partnering lenders.
SBA Loan Programs
There are different types of SBA funding programs for business owners. Deciding which one is right for you, will depend on the goals and needs of your business, its size, and the time operating.
The only two loan programs that are available through Vander Ford Funding are the 7(a) and the 504. If you’re looking for other types of SBA financing programs, visit the Small Business Administration’s website by clicking any of the links below.
Eligibility Requirements
In order to expedite the process, you should have certain documents ready before applying for a loan.
Here’s just some of what you’ll need to apply for a small business administration loan:
- Signed Vander Ford Funding Loan Application
- Completed Personal Financial Statement
- 12 months of business bank statements
- 2 Years of Business Tax Returns
- 2 Years of Personal Tax Returns
- Year-to-date Financial Statements
- Profit & Loss Statement
- Balance Sheet
- Copy of Recent Credit Score
SBA CDC/504 Loan Program
The Certified Development Company (CDC) loan was designed for businesses that wish to purchase fixed assets for expansion or modernization such as business equipment, machinery, furniture, or commercial real estate. It requires a low down payment (Starting at 10%) and provides fixed interest rates with long repayment periods.
CDC/504 loans are popular among businesses that are planning to buy or build owner-occupied commercial properties. However, these businesses have to occupy at least 51 percent of the commercial building.
SBA 504 Loan Features
- Loan Amounts: Up to $10,000,000
- Terms: 1-20 years
- Funding time: 2-5 days
SBA 504 Loan Requirements
- Business must have a net worth of less than $15 Million
- Business must have an average net income less than $5 million after taxes for the preceding two years.
If you’re not sure which loan program is right for you, Vander Ford Funding can help. Talk to one of our specialists, and he or she will evaluate your business’ needs, explain the pros and cons of each program, and help you decide which program is right for you. And if your business is still not yet eligible for SBA funding, we will be honored to work together until we secure the much-needed financing.
