Join our Newsletter!
Get in Touch!

Need money for your business? Ask Uncle Sam!

19 Oct 2009 8:24 PM | Working Women (Administrator)

In 1953, Congress enacted the Small Business Administration with the passage of the Small Business Act.  If your business could use a helping hand, an SBA loan is something you should consider. Even if you aren’t necessarily looking for a loan, www.sba.gov offers a multitude of important information any business can benefit from.   

 

Contrary to popular belief, an SBA loan isn’t something specifically for people looking to start a new business, but is more so to help fund new businesses that  need help getting established.  SBA loans offer longer repayment periods and less strict affordability requirements than normal commercial business loans.  A very popular use of SBA loans is for commercial mortgages on buildings, because unlike most bank programs, borrowers are not required to refinance every five years.

 

So how do you get started?  First, spend some time familiarizing yourself with their website.  Then, go apply for business loans at private banks.  I know this sounds contradictory, but before seeking an SBA loan, you must first provide the SBA proof that you can't get a loan from a private source.  You must be turned down for a loan by at least two different banks before you can apply.  If you live in a rural area, one turn down might be enough.

 

Once you are rejected (don’t take it personally), ask your banker if they would grant you the loan under SBA's loan guarantee plan, or if they would work in conjunction with the SBA on a loan.  If your banker is interested, ask if they will contact them using the SBA’s hotline number, which is 1-800-827-5722, to discuss your application.

 

If your bank is just not interested in working with you, then you'll have to apply directly to SBA for a loan on their website.  You'll be required to fill out the SBA loan application, and submit other forms designed to help SBA assess the soundness of your business.  You will need to write a business plan, a statement of personal history, and a monthly cash flow projection.  Although this may sound daunting, the website will walk you through completing these documents with ease.

 

After you have submitted your application packet, SBA will evaluate your request to determine your chances of success.  If you plan on operating the business by managing all the day-to-day details on your own, that's an important plus.  Another aspect that will help tip the scales in your favor is if the business will be your sole source of income.  The SBA figures that you'll work that much harder at keeping the business afloat if your family’s livelihood depends on it. 

 

The SBA will also look at your ability to repay the loan.  They will look over your credit history, and although it won’t preclude you altogether, if you have a bankruptcy on record or a default of another loan, your application will receive an extra level of attention that may considerably slow down the process. The most important thing to remember is not to give up.  Don't count yourself out no matter how weak your financial condition may currently seem.  

 

This program was designed to help American business grow - including yours.  Even if you aren’t looking for a loan right now, the SBA also offers several management assistance programs that could prove to be very valuable.  Don’t be afraid to take advantage of everything Uncle Sam has to offer! 

               

Comments

Working WomenHome | About | Events | Join Us | Sponsors | Blog | Connect | Site Map
1-888-WW-UNITE • workingwomenoftampabay@gmail.com
Copyright 2019 Working Women of Tampa Bay  |  3030 N. Rocky Point Dr. | Suite 150 | Tampa, FL 33607
Design Integration by The ARRC™

Powered by Wild Apricot Membership Software