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SBA Loan Overview

Get great rates, long repayment terms, and low monthly payments with SBA loans.

SBA Loans Overview

IBC | We've Been There So We Can Get You There.

When it comes to small business financing, IBC has been there so we can get you there. We've transformed the traditionally lengthy, complex process of applying for an SBA loan into a more manageable task through our efficient application process and dedicated team. Our skilled lending professionals accompany you at every stage, as you complete our online application and craft your financial narrative. If an SBA loan isn't the ideal solution for you, we're committed to assisting you in finding the right loan for your business from our network of trusted banks and non-bank lenders.

SBA Loans: The Basics

You may have heard that SBA loans stand out as one of the superior choices in the realm of small business financing. The funds derived from these loans can be utilized in a variety of ways to support a small business, but what really is an SBA loan? We'll explore the costs, qualifications, potential uses of the funds, assisting you in evaluating whether this loan type is the optimal funding solution for your small business.

  • Should I consider getting a business credit card for my business financing?
    A business credit card can be a useful tool for managing cash flow and accruing benefits. Business credit cards often offer a grace period to pay off the balance interest-free, and they come with perks such as cash-back incentives, insurance, and reward points. However, it's essential to research thoroughly and choose a card that matches your business needs. There are other types of unsecured loans as well that might make more sense. IBC has experience with this as well.
  • What are my financing options if I want to avoid crippling debt?
    There are several financing options apart from traditional lenders that might better suit your needs and capabilities. These include private lenders, credit cards, government grants, borrowing from family and friends, and no-interest loan schemes from not-for-profit lenders. Each option has its pros and cons, and it's crucial to be well-researched and prepared when considering these alternatives. IBCs team can help you determine the best options given your specific situation.
  • What is the difference between a Term Loan and a SBA loan?
    An SBA loan and a term loan differ mainly in terms of their backing and use. An SBA loan is partially guaranteed by the Small Business Administration, a U.S. government agency. This guarantee reduces the risk for lenders, making them more willing to lend to small businesses. SBA loans are generally used for a variety of business purposes, such as working capital, refinancing existing debt, or purchasing equipment and real estate. They also typically have longer repayment terms and lower interest rates, which can make them a more affordable option for small businesses. On the other hand, a term loan is a standard loan offered by banks and other financial institutions, without any government guarantee. Term loans are used for specific purchases, such as equipment or real estate, or for general business funding. The repayment period of a term loan, or its "term," is fixed, usually ranging from one to five years, though some can extend up to 20 or 25 years. Interest rates, terms, and requirements for term loans can vary widely between lenders, and may be higher or more stringent than those for SBA loans due to the lack of a government guarantee. While both loans can be beneficial depending on your business needs, it's important to thoroughly understand their terms and conditions before deciding which is right for your business. This is where IBC comes in, we make sure our clients get into the right loan!
  • My bank turned me down for a term loan, what are my options?
    Even if your bank has turned down your application for a term loan, it's important to remember that it's not the end of the road. Banks and credit unions view loans to small businesses as investments, each with their unique risk parameters and lending preferences. What one bank may perceive as too risky, another might see as a solid investment. This is where IBC's extensive network of banks and credit unions becomes a game-changer. At IBC, we've cultivated strong relationships with a diverse array of lending institutions, each with their distinct lending profiles. This allows us to leverage these insights to find the right match for your specific needs and financial circumstances. Our goal is to connect you with the lender most likely to approve your loan request, streamlining the process and increasing your chances of success. In instances where a term loan may not be the best fit, IBC can still assist. We take a customer-centric approach to lending, working closely with you to understand your needs and explore alternative financing options. Our dedicated team will guide you every step of the way to ensure that you secure the best possible funding for your business. Remember, a 'no' from one bank doesn't equate to a 'no' from all banks. With IBC, you have an ally in your corner, committed to helping you navigate the lending landscape and achieve your business objectives.
  • What are my options if I’m not approved for an SBA loan?
    Our network of reputable lenders provides an array of alternatives for businesses that may not currently meet the eligibility criteria for SBA loans. IBC streamlines the process, bringing you multiple financing opportunities tailored to your needs.
  • What can I do with my SBA loan?
    SBA 7(a) loans ranging from $30,000 – $350,000, available from banks in the IBC network, are designed for a variety of uses, including debt refinancing and providing working capital. Working capital can cover operational costs, marketing initiatives, hiring efforts, and more. These SBA loans also cater to new equipment purchases, facilitating business growth. Furthermore, SBA 7(a) loans are suitable for refinancing existing business debt that isn't secured by real estate, such as cash advances, business loans, and equipment leases. On the other hand, SBA 504 loans are specifically tailored for real estate and heavy equipment purchases. With loan amounts from $125,000 to $20 million, businesses can purchase land, buildings, or long-term machinery and equipment, or make improvements to existing facilities. SBA Commercial Real Estate loans in the range of $500,000 – $5 million from banks in the IBC network can be utilized for purchasing or refinancing commercial real estate that's 51% owner-occupied.
  • What is an SBA Loan
    An SBA loan is a small business loan guaranteed by the government, characterized by its long-term and low-interest rate features. There are two main types of SBA loans: 7(a) loans and 504 loans. The 7(a) loans are general purpose loans for a wide range of business needs, while the 504 loans are specifically designed for the purchase of fixed assets, like real estate or equipment. The Small Business Administration (SBA), a government agency established in 1953, provides partial guarantees for these SBA loans, offering essential support to small business owners across America. One common misconception about these loans is that the SBA itself lends money directly to small businesses. In reality, the SBA typically does not issue loans directly. Instead, the SBA provides a guarantee for the loan, vowing to cover a certain percentage of the loan to the bank if you, the borrower, default. This guarantee mitigates risks for banks and other lenders, prompting them to extend these loans to a broader range of American small businesses. While many banks and financial institutions offer SBA loans, their processes, requirements, and associated fees can differ.
  • How do I apply for a SBA Loan?
    Before recent technological advances, small business owners seeking an SBA loan had one primary option—walking into a bank. That is not the case anymore, many businesses might be unaware that a 'no' from one bank doesn't mean a universal rejection; another bank might readily say 'yes' to the same prospective borrower. Thanks to technological and process advancements, small businesses can now find a suitable SBA loan provider online. In fact, IBC has an extensive network of Preferred SBA lenders specifically for small businesses. With multiple banks, each having diverse credit requirements, we've succeeded in helping many applicants secure an SBA loan after initially facing rejection from their local banks. Our team of experts pair borrowers with the lender most likely to approve and fund their loan. Instead of investing your time in visiting bank after bank, IBC does the leg work so you don't have to making applying for a loan swift and effective.
  • What makes a line of credit from IBC Lending Partners special?
    A line-of-credit stands out due to its flexible structure. You only pay interest on the funds you actually use, not your total credit limit. This can make it a more cost-effective option for businesses that need flexible access to capital.
  • Can I apply for a line of credit even if I don't have an immediate need for funds?
    Yes, it can be a good idea to establish a line of credit before you need it. That way, you have a financial safety net in place for unexpected expenses or opportunities. Remember, with IBC's line of credit, you only pay interest on the funds you actually use.
  • What are the different ways I can use funds from a line of credit?
    The flexible structure of our business line of credit at IBC allows you to use the funds in a variety of ways that are best suited for your business needs. Here are some examples: Staff Expansion: Funds can be used to hire new staff members to help grow your business or manage increased demand. Inventory Purchase: You can acquire additional inventory to meet customer demand, especially in peak seasons. Project Financing: If you have an upcoming project, a line of credit can help finance it, ensuring smooth operations. Business Opportunities: Whether it's a lucrative deal or an unforeseen opportunity, ready funds can be decisive.
  • What can I use an SBA Express Line of Credit for?
    The funds from an SBA Express Line of Credit can be used for various business-related expenses, such as working capital, equipment purchases, and refinancing debt. It can also be used to meet other financial needs of the business.
  • What is an SBA Express Line of Credit?
    An SBA Express Line of Credit is a type of financing provided by the Small Business Administration (SBA) and its lending partners. It offers businesses quick access to funds. The interest is only charged on the outstanding balance of the loan.
  • When should I consider applying for a line of credit?
    A line of credit is a good option to consider when your business needs flexible access to funds. This could be for managing cash flow, financing short-term needs, or taking advantage of unexpected business opportunities. If you're unsure whether a line of credit is right for you, our lending experts at IBC are ready to guide you.
  • How much can I borrow with an SBA Express Line of Credit?
    The maximum loan amount for an SBA Express Line of Credit is $350,000.
  • Who is eligible for an SBA Express Line of Credit?
    To be eligible for an SBA Express Line of Credit, a business must be a for-profit enterprise operating in the United States, have invested equity, and have exhausted other financing options. Additionally, a business needs to demonstrate a need for the loan and an ability to repay it.
  • What is hard money lending?
    Hard money lending (also called bridge loans) is another alternative to traditional lending sources and allows borrowers to use the investment (in many cases, a property) as collateral on the loan. While many lending sources rely on a borrower’s credit history, hard money lending relies on the asset in question. Hard money lending will typically require higher interest fees than traditional loans but can provide borrowers with increased access to capital and a more lenient approval process. Investors with low credit and high equity in a property will often turn to hard money for funding. Additionally, property owners at risk of foreclosure may also utilize hard money loans.
  • How does private money lending differ from traditional lending?
    Private money lending differs from traditional lending in several ways, including the source of funds, approval speed, loan terms flexibility, and borrower qualifications. Private money lenders are not subject to the same regulations as traditional financial institutions, which allows them to offer more customized loan terms and make faster decisions. They may also be more willing to lend to borrowers with unconventional income sources or low credit scores.
  • What are the risks and disadvantages of private money lending?
    Some risks and disadvantages of private money lending include higher interest rates, shorter loan terms, the potential for predatory practices, and regulatory risks. Borrowers should carefully evaluate the terms and conditions of any private money loan and thoroughly research potential lenders before entering into an agreement.
  • What are the advantages of private money lending for borrowers?
    Some advantages of private money lending for borrowers include faster approval times, more flexible loan terms, and the ability to obtain financing even with unique circumstances or lower credit scores. This type of lending can be particularly useful for real estate investors who require quick access to funds for property acquisitions or renovations.
  • How can you find reputable private money lenders?
    To find reputable private money lenders, borrowers should conduct thorough research, seek recommendations from trusted sources, and consult industry professionals. Online platforms, forums, and local real estate investment groups can also be useful resources for identifying reliable lenders. It is essential to perform due diligence and verify the lender's reputation, licensing, and compliance with applicable regulations before entering into any loan agreement.
  • Who should consider private money lending?
    You may want to consider private money lending if one of the following applies to you: You are a real estate investor looking to expand your portfolio. You are a doctor, lawyer, CEO, or professional of another kind who has a great income or a surplus of cash. You have a sizable retirement savings account. You are a retiree looking for a passive income investment. You are owner of an estate or other trust fund. You are a tech entrepreneur who owns a successful start up. You are a lottery winner. You want to and are able to help out a friend or family member.
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