Tips for Getting a Small Business Administration Loan
A Home Business Article Contributed by Elizabeth Fox-Wise
The Small Business Administration Has a Portfolio of over 219, 000 Small Business Loans
The Small Business Administration is an independent government agency which exists to provide support and recourses for US Small Business. One of the services available through the Small Business Administration is a portfolio of hundreds of thousands of loans that are available for small business. Most of these loans come with better repayment terms and lower interest rates than do traditional small business loans.
The funding that you need to open the small business of your dreams, or expand an existing one, is available through the Small Business Administration if you know how to go and get it.
Before Applying for a Small Business Administration Loan Write a Loan Proposal
When preparing to submit an application for a Small Business Administration, you should write a loan proposal. There is one key difference between an effective loan proposal that gets the money you need for your small business and one that does not. This proverbial key is knowing exactly what the lending institution is looking for, and ensuring that they see it when they look at your loan proposal.
Basically, a loan proposal consists of two critical parts:
A thorough and well thought out business plan with full financial statements.
A complete set of supporting documents, including the loan application.
Your loan proposal must answer the following questions for the lender:
Who are you?
How much money do you need?
How is this money going to be used?
How are you going to pay the money back?
What happens if you can't pay the money back?
If you need help preparing a loan proposal, you can go to the Small Business Administration for that too! The Small Business Administration offers several mentoring programs to choose from. A mentor can give you advice and instruction on how to prepare the best loan proposal which will give you the highest chances of securing a Small Business Administration loan.
What Else is Involved in Getting a Small Business Administration Loan?
Among this vast portfolio of loans the Small Business Administration has, some are government loans given directly by the SBA. For the government SBA loans, you will apply directly to the Small Business Administration for the loan.
The other loans are "cooperative efforts" set up with the SBA and lending institutions and in these cases you will often have a choice of which bank to wish you want to apply for your small business loan.
Although you are the one in need of money, you should still be in control when it comes to choosing the bankers or partners you want to to business with. Make sure the bank is interested in your small business and will provide you with the services your business will need. You should also look for a banker with whom you feel you can develop a good ongoing relationship and that has experience with similar small business.
The next step is to submit your loan proposal. Handle the process professionally. Schedule an appointment, arrive on time and have a business demeanor throughout the meeting.
