SBA loans are highly competitive but extremely valuable to your business. You get good rates and terms that make it advantageous to take the time to go through the process. Knowing what it takes to get an SBA loan will help you when it comes time to apply. Get your business in order with these tips.
Most SBA loans require a personal credit score of 680 or more, even with a good business credit score. You’ll want to get your personal finances in order before you apply for an SBA loan. The eligibility criteria for SBA loans is more stringent than some loans, because the SBA is backing the loan.
Financials of Your Business
The lender will likely require a list of documents that can be daunting. If your bookkeeping is in order, you’ll just need to run current P&L, balance sheet, assets and cash flow reports. You’ll probably also need to show bank statements from the past few months, tax documents, both personal and business, and a business plan.
Can You Repay the Loan?
The lender will want to know that you can make payments, which means you’ll need to demonstrate that you meet that criteria. Ideally, your income should be at least 1.25 times your expenses, including the new loan payment.
Have a Plan
SBA loans are time-consuming because of the paperwork involved. But the payoff of getting better interest rates over 25 years makes it worth the effort. Go into the process fully aware of what you’re getting into. Know what you want the money for and be prepared to put in some time while the loan is going through the process. It’s not going to be quick, but it will be rewarding.
Blackwater Capital Funding can help your business with an SBA loan and other financing. Contact us today for more information.