Every person who has an interest
in business thinks of starting one or upgrading the existing one at some point
of time in life. The idea may seem impressive, but when it comes down to obtaining
the money, it gets difficult to choose from where one should receive the same.
Many go asking their family and friends or mortgage their homes. But the best
solution that can help you the most is SBA loans. SBA (small business
administration) is a federal agency. It was established to protect and support
the small businesses in the United States by facilitating those with SBA loans.
It is best known for the loan guarantee program, but it offers a wealth of
other information and resources for small business owners.
There are two kinds of SBA loans.
One that is secured by real estate and second that is not. Below mentioned are
the benefits of the two:
1. SBA
7(a) & Express loans – this is the most common loan that SBA offer to the
people. It is used for a credit with or without real estate as collateral
including equipment, business, and purchases. This loan provided maximum amount
to the person in need – up to $2 million and at the same time offer terms of
the loan up to 25 years (only on the real estate transactions). But the loans
adopted for working capital, debt refinancing. Business purchases etc. offer
loan terms of 10 years. They are very easy to qualify and are even provided to
the ones who do not have a three years financial history.
2. SBA
504 (CDC) Loans – this loan is opposite of the loan mentioned above. These are
adopted by the people who are looking for long-term financing and the purchase
of physical buildings or real estate. The amount of this loan type can be
increased to $5 million maximum that too after a series of discussions. The SBA
offers larger amounts to the companies who believe in “go green” and want to
make the changes to the infrastructure that saves energy and adopts other
conservation changes.
Besides these types of loans, SBA
also provides with medical practice loan and various other types according to
the need of the people.
What are the eligibility
requirements for SBA loans?
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