The Small Business Administration offers financial assistance and business planning for small business owners. The SBA helps small businesses obtain financing through loans and grants. The SBA is a guarantor not an actual lender. Here are the factors that determine how long it takes to get an SBA loan.
The length of time it will take you to get your SBA loan depends on how fast you return your completed application to the SBA. The amount of time it takes you to receive your loan is also dependent on the loan program you choose.
Be prepared to disclose a complete business plan. You must have personal and business financial statements. Determine if you will use collateral. Project earnings for your business. Write a balance sheet displaying financial projections if approved for the loan.
Types of Loans
Basic Loan Guaranty is the most popular SBA loan. You may use loan proceeds in any business-building manner. The key to getting your SBA loan approved fast is completing your business plan, and completing the loan application documents in a swift, but thorough manner. Again, there isn't a definitive time frame as to when you actually receive your SBA loan.
Certified Development Company 504 loans are long-term loans issued to a company at a fixed rate. The funds from a 504 loan must be used to purchase property, equipment or machinery.
A microloan program usually takes the least amount of time to gain approval. However, there is no set time frame deciding how fast you will receive a SBA microloan. A microloan is for not-fo-profit child care centers or small businesses. The maximum loan amount is $35,000, and it can't be used to buy property or to pay debt.
The SBA tries to reach a loan decision in 7 to 21 days from the time they receive a completed loan application.