Unlock cashflow to help scale your business operations.
Borrow As Needed
Our SBA loans are on-demand extension of your cash flow.
Flexible & Renewable
We provide same-day renewals and early pay off discounts for reduced interest.
Pay Only if Used
Get the entire amount needed in one-shot or use as needed. Secured options available.
When it comes to finding the best source of capital for your business, taking out a loan can be beneficial. Lenders can provide business owners with the funds they need to help launch or expand their business. It’s important to do your research when taking out a business loan to understand the fundamentals of it. Knowing how a business loan works, what type to apply for, and what repayment plan works best for you will help narrow down the best business loan option for you.
As mentioned before, lenders give business loans to business owners to help fund their business. Lenders will work out a repayment plan with the owners to ensure that they are receiving their money back over time along with additional fees and interest added on. Every business owner’s loan arrangement is different and is based on a few factors.
SBA Loans: Financing made for you!
It takes just 5 minutes to fill out your application and just a few hours to get offers!
We help you compare your options with ease and always work to get you the most favorable terms.
Our advisors will make sure that the product you have chosen will suit your business needs best.
How to qualify for an SBA loan
SBA loans are just one of the products used to help get you the financing you need for your business.
Here’s what you’ll need to qualify:
- 4+ months in business
- $110K+ annual revenue
- 550+ credit score
- Majority ownership of the business
- Business bank account
SBA Loans Small Business Approved
Opening a small business comes with a plethora of responsibilities. Many business owners will start launching by taking out a loan. SBA loans provide small businesses with working funds backed up by future bank and credit card deposits. As tempting as it can be, an SBA loan may not be the right solution for your business. It’s easy to obtain from a certain standpoint, the underlying truth is that loan approval is based heavily on annual earnings and credit scores.
Lenders consider three main factors when making the decision about your application:
- your current revenue
- how much you overleveraged with merchant loans
- your credit score
With a high credit score and a good cash flow for your business, you’re more inclined to receive better offers. If you don’t meet the lender’s requirements, seeking other alternatives maybe your best option.
SBA loans have their pros and cons. They have a high approval rate, but they also have a higher payback rate. When compared to other sources of funding such as business credit cards and MCA loans, they still fall at the highest payback rate. Businesses will start to feel the strain of an SBA loan when their funds start to run out; this is when most business owners will start to look and apply for their next loan. Some owners may find themselves stuck in the cycle with up to six or more SBA loans. This usually leads to seeking bankruptcy.
Go with SBA loans or reverse consolidation
When finding funding for your business loan, a merchant cash advance may be the choice for you. An MCA helps small businesses find alternatives to another financing. They provide business owners with funds upfront in which the owners repay the advance with a percentage of the business’s sales. The payments can be made weekly or monthly until the advance is paid in full. As resourceful as the option is, this type of funding can lead you into a pitfall of debt consolidation.
If you’ve accumulated debt from one or more MCAs and can qualify for a traditional consolidation loan, you have options in terms of repayments. You’ll receive:
- Lower interest rates
- Longer repayment periods
- Monthly loan payments
Most business owners, unfortunately, don’t qualify for a traditional loan because high debt equals high risk for lenders. This leaves business owners with options that may not be in their favor such as:
- Another high-interest MCA
- An MCA Consolidation Loan
- An MCA Reverse Consolidation Loan
Another SBA loan? Don’t fall for it
When taking out more funding, you want to avoid “stacking.” Many business owners find stacking to be a solution when it only creates a bigger issue. SBAs are easy to obtain since they don’t require high credit scores and collateral for the long run. Using a new SBA loan to help pay off your original MCA can help relieve some of the burdens, but overall, it’s expensive. This tactic has only really led to business foreclosure.
Consolidation helps put merchants back on track towards long-term sustainability. This solution works best. This is a great solution for recipients struggling to make daily payments and struggling with a steady cash flow. An SBA loan will help ease some of the financial burden. A cash advance company will first buy out all your existing debt (in cash advances) and roll them into a single payment for a better rate and term.
Business owners require to net 50% of the loan amount after the cash advances are paid off. If a new loan $50K is acquired then the merchant only owes 25K or less to their creditors. In some scenarios, refinance funders and consolidation are willing to pay off the entire debt but not offer any new additional funding.
When it comes to a reverse consolidation scenario, the SBA loans stay in place, but the lender takes care of the daily payments. As a result, you pay the reverse consolidation company a portion of what you have been paying–again for a longer-term. Payments are made to the reverse consolidation provider well after all the other cash advances are paid in full. Both options are relatively the same and work as good ways to reduce your business debt.
Multiple Lenders and Consolidating SBA Loans
Business owners with collateral have more of an advantage when taking out a loan. Having an asset-based consolidation loan allows you to take out as many loans as needed as long as you have enough to secure them. Anything from real estate to commercial property qualifies. With options like MCAs and debt restricting companies, your agreement has room for adjustment including a payment schedule that works best for you.
It’s highly recommended to investigate all your options for getting approved. You can:
- Research online
- Call companies
- Word of mouth from acquittances
Having a single payment is just one of the perks of consolidating SBA loans. The other benefits that can provide advantage include:
- Flexible payment schedule
- Longer payback term
- Lower interest rate
When in Debt, Eliminate It
When in debt, many business owners will use additional debt to cover current debt. The goal of taking out another loan should be to help expand your business in the most profitable way. Debt consolidation seems like a saving grace because it provides more flexibility for your cash flow, preventing your business from having too many open holes. By taking on the additional loan to pay off the other, you’ve now increased the duration of paying off the loans in addition to the interest being charged.
Debt elimination companies are more than likely the best option for your business. Their goal is to eliminate more than half of your current outstanding debt. By helping seek their assistance, you could receive up to a year of repose, which means placing a temporary stop to your creditors to free up your finances. This can help you save up for a final settlement that’s much less than what you owe. You will receive letters of release from your creditors, freeing your business to retrieve a healthy status again.
Got some questions?
Helping reduce risk for lenders, SBA loans are usually given to small businesses. Lenders work the SBA to secure loans for business owners. This guarantees that lenders will get their money back.
Traditional business loans don’t have the security that an SBA guaranty has, making it harder to obtain one. In addition, loan amounts are usually lower than an SBA loan because they aren’t as secure.
The pros of an SBA loan include having lower down payments required, up to 10 plus years on a repayment plan, and APR limits.
The cons include personal assets required, limited options when applying with lenders, and negative impact on the liquidity of your business.
Take 5 minutes to fill out our online application and from there we can help provide you in which direction to go. If you have any questions, you can also give us a call and one of our representatives will be more than glad to assist you further.
Make sure to have the following numbers ready on hand, these are what we take into consideration when making our decision:
- Annual/Monthly Revenue
- Length in Business
- Credit Score
Meeting minimal requirements still gives you a likely chance or qualifying, don’t let having a below average credit score scare you.
You are the owner of your business which means it’s your responsibility to make sure your business is in the best shape possible. Even when obtaining financial support, lenders want to be sure that you are a good candidate for their services.
Having the minimal requirements or better is important and is already first step of getting the approval you need. The healthier your business status is, the better chances you have at getting the best deal possible.