Search for Small Business Loan Sources and receive your matched lender list
AND received FOUR free Business eBooks worth $39.95!
Search for Small Business Loan Sources

Small Business Administration (SBA) loans – or 7(a) loans, are often a coveted prize for U.S. companies. They offer some of the lowest rates anywhere on small business financing and generally provide the longest repayment terms as well. The loans are guaranteed by the U.S. government so businesses can feel confident in the security of their funding.

These loans sound ideal and yet many business owners won’t even consider applying for them. Why? The application process for SBA loans is notoriously long. It can take anywhere from weeks to months to apply and get approval for and SBA loan. Many small businesses do not have that kind of time to wait for funding.

Even for those who can wait for cash, the requirements for SBA loans are often too stringent to qualify. For example, businesses typically need to have been established for at least two years, be profitable, and have decent cash flow. Struggling businesses need not apply.

And of course there is a whole list of businesses that are excluded from even applying. Life insurance companies, businesses that derive more than a third of their revenue from legal gambling, consumer and marketing cooperatives, and speculative businesses such as those in oil exploration are just a few of the types of firms that may not receive SBA loans.

Beyond all of these reasons why businesses may not think applying for SBA loans is worth their time, there is also the acceptance rate. Over the past several years, only about 30% of new businesses get approved for funding, only 17 percent of rural business are approved and for those asking for loans less than $350,000, the approval rate it only about 10 percent.

So, if you have an existing business in an urban setting and need a really large sum of money, an SBA loan may be a perfect fit for you. For all others, the time-consuming application process just may not be worth your time.


Search for Small Business Loan Sources and receive your matched lender list
AND received FOUR free Business eBooks worth $39.95!
Search for Small Business Loan Sources