Countless business owners are unaware of the fact that the SBA has guaranteed in excess of $18 Billion in small business loans so far this year. Why not you?
The Springtree Group (STG) offers The Seven Myths of Getting a SBA Loan as a free service to brokerage/agency owners who need capital to grow, buy or sell their firms. STG is the largest company in the U.S. to offer a portfolio of financial packages to specifically support the agent and brokerage community. Our SBA package is one of these offerings. As with our other loan packages, our SBA program typically provides loans based on your firm’s cash flow, not your personal hard assets. See which of the seven myths below you previously believed, and how getting the facts can help you achieve your business goals.
The Seven Myths of Getting a SBA Loan:
Myth #1 – The SBA is for small business loans for people with poor credit who cannot find capital elsewhere.
Not true – SBA working capital loans go up to $5 million.
Myth #2 – Getting a SBA loan means you will have to deal with the government.
Not true – The SBA guarantees the loan. The funds are loaned from a bank. You will deal with the bank.
Myth #3 – To get a SBA loan you must be fully collateralized.
Not true – “A loan request is not to be declined solely on the basis of inadequate collateral.” SBA Standard Operational Procedures
Myth #4 – SBA loans have higher interest rates and shorter terms than conventional loans.
Not true – Current working capital loans are at 6% with terms out to 10 years.
Myth #5 – The SBA requires you put down at least 20%.
Not true – Your existing equity in your company can allow you to borrow without an additional cash injection. When you purchase an agency, a seller note is considered equity.
Myth #6 – Since you are preparing to sell your business, you have no need to understand the SBA as a source of capital.
Not true – Educating potential buyers of the SBA as a source of capital can allow you to reach a broader market – and prevent you from having to finance the buyout yourself.
Myth #7 – The process of getting an SBA loan is a nightmare.
This one happens to be true – if you do not have a professional team that knows the system, has the banking connections with SBA lenders, and can get advocacy from the SBA on your behalf.
If you are agency owner looking to sell to an outside entity, sell to your children, buy other agencies, grow their agencies or start a new agency please contact us.
To schedule a phone conversation and receive a FREE FINANCIAL ANALYSIS to determine whether an SBA loan is right for you, please contact us online.