Once you've determined that an SBA or traditional bank loan is the right kind of financing for your business, you'll need to package your financial information in a way that makes it easy for a banker to make a favorable decision. At the most basic level, you will need to provide:
- Basic information about your business (a completed business plan)
- Basic information about the loan amount and terms you are requesting
- Financial information (and/or projections) for your business
Each owner will be asked to provide personal financial information, as well as statements of personal history. Fill out a personal financial statement and personal history.
Banks will also want to see how you will use the funds. A well put together financial projections document will help you organize all the details. More information can be found from the SBA's Preparing Financial Statements page.
The IASourceLink network has Resource Partners who are skilled in helping business owners prepare their loan applications. Find counseling in your area through the Resource Navigator . Follow the link and search for "Loan Packaging" under "Financial Assistance". You can also reach us toll free at 866-537-6052 or on the Iowa Business Concierge page.
The three principal players in SBA Loan Guarantee Programs are the small business applicant, the lender, and the SBA which guarantees a portion of the loan. The business loans that SBA guarantees do not come from SBA but rather from banks and other approved lenders. Loans are funded by these organizations, and they make the decision to approve or not to approve applications.
The SBA guaranty reduces the lender’s risk of borrower non-payment. If the borrower defaults, the lender can request SBA to pay the lender that percentage of the outstanding balance guaranteed by the SBA. This allows the lender to recover a portion from SBA if the borrower can’t make the payment. The borrower is still obligated for the full amount.
A Quick Reference to SBA Loan Guaranty Programs is available.
Find your Iowa SBA Resources online. Some of the primary SBA Loan Guarantee Programs are briefly explained.
The 7(a) Loan Program is SBA's primary business loan guarantee program and most frequently used non-disaster financial assistance program because of its flexibility in loan structure, variety of loan proceed uses, and availability.
SBAExpress offers streamlined and expedited loan procedures for particular groups of borrowers, notably active duty military personnel, veterans, and borrowers from distressed communities. An accelerated SBA review time means you will receive a response to your application within 36 hours.
Patriot Express is for veterans and members of the military community wanting to establish or expand small businesses. The SBA and its resource partners are focusing additional efforts on counseling and training to augment this loan initiative, making it more accessible and easy to use.
CAPLines is an umbrella program that helps small businesses meet their short-term and cyclical working-capital needs for five “lines” including: seasonal, contract, builders, standard asset-based and small asset-based.
Small/Rural Lender Advantage Initiative is designed to accommodate the unique loan processing needs of small community/rural-based lenders, many of which make very few SBA loans.
Small Loan Advantage is designed to expand access to capital for small businesses and entrepreneurs in underserved communities to help drive economic growth and job creation. This initiative allows lenders to get a pre-qualification indication from SBA that the applicant business has sufficient creditworthiness to warrant giving the applicant full consideration for financing.
Export Loan Programs including Loan, Working Capital and International Trade are specifically designed to help small business exporters to develop or expand export activities.