Government loan programs: Your key to non-standard credit-scored funding.
Government loan programs, specifically the Small Business Administration 7(a), are SBA-backed programs that do not use the same criteria as large financial institutions. It is a prevailing misconception that a business needs to be in financial distress in order to qualify for an SBA loan. The truth is that many healthy companies obtain SBA backed financing every day.
Here are the advantages and benefits of the SBA 7(a) business loan:
• Lower capital requirements
• Less collateral needed to obtain the loan
• No points or balloon payments
• Longer amortization periods
• Higher loan-to-value financing
Proceeds from your SBA 7(a) government loan may be used to:
• Expand or renovate facilities
• Purchase machinery, equipment, software, fixtures and leasehold improvements
• Finance receivables and augment working capital
• Refinance existing debt (for compelling credit reasons of benefit to the borrower)
• Provide seasonal lines of credit
• Construct commercial buildings
• Purchase land or buildings
Government loan programs exist because they understand the importance of the small business to the US economy, and so the more businesses that they can help with the money, the more jobs that will be created in the USA. These loan programs work because the government secures the loan by guaranteeing a certain percentage of the loan, so that lenders can feel confident that most of their loan will be repaid if the business can’t make their payments. The SBA will guarantee up to 75% of the loan, with a maximum guarantee of $750,000.
Search our funding directory today to find lenders that can help you find an SBA loan that works for your business.