Getting a loan is not always easy. There is red tape galore, and if you ever make it through all of that, there is the issue of approval. For new and even some existing small businesses, lenders see the risk as just too great and then say, no thanks.
However, the Small Business Administration (SBA) backs loans offered by lenders to entrepreneurs in an effort to make it easier for them to support small businesses. The chances of being approved are greater, mostly due to the fact that these loans are approved based on the merits of the business rather than the credit of the business owner.
This is why the government shutdown is so potentially crippling to the economy. Small companies produce about two-thirds of new jobs. The ongoing government shutdown has stopped the flow of SBA-backed loans to small business owners in search of funding. Until the impasse ends, entrepreneurs will be unable to secure important funding options, such as:
SBA 7(a) Loans
These are general business loans backed by the SBA and offered to small businesses for start-up or expansion. The SBA.gov website lists types of businesses that are eligible, and a few that are not. The loans are designed to help small businesses get started, or to help existing small businesses grow. They are an excellent option for those who may be without other financing sources. The interest rates are kept generally low compared to other types of loans, making them especially attractive — despite the potentially long wait for approval notification.
SBA 504 Financing
This genre of SBA small business loans is a little different. They are designed specifically for those seeking to finance real property such as real estate or equipment. The general guidelines for types of businesses eligible are the same as those for the 7(a) loans, and the application process is much the same as well.
SBA Express Loans
These loans are meant to shorten the approval process for those who need money quickly. There are some drawbacks, such a higher interest rate and some stricter credit guidelines, but the payoff for receiving funds faster is worth it to many
Biz2Credit.com has arranged hundreds of SBA loans and overall has processed more than $1 billion in small business financing through its network of 1,200 lenders. Many of the lenders are banks that work with the SBA to provide loans for small companies.