How to Qualify for an SBA Loan
Small-business administration (SBA) loans are a solution to start or expand your small business, designed to provide financing with flexible terms for the purchase of small business assets, such as real estate, buildings, and machinery, along with reasonable terms. SBA loans can greatly help you grow your business. It can even be easier if you work with a nationwide SBA expert like Radius!
The first step exploring SBA loans is to know if you even qualify. Below are some factors you will have to consider:
1. What does your credit look like?
When applying for an SBA loan, your personal credit score will typically be looked at closely. The health of your personal credit score will likely determine whether you will qualify for an SBA loan, as this will give the company a look into whether or not you’d manage your debt correctly. Aim to have a score above 700 and you should be in the clear.
2. Do you have your documents in line?
To apply for an SBA loan, you’ll need various legal and financial documents to present to the bank. These documents may include income tax returns, income statements and balance sheets, bank statements, licenses, leases, articles of incorporation, etc. Having these on hand and ready to go will be important, so be sure to gather them with ample time before applying.
3. What’s your business plan?
Potential lenders will likely want an idea as to where your SBA loan money will be going. Approaching the meeting with a strong business plan with details on the purpose of the loan, how you’ll pay the loan back, how you’ll increase profits, and tactics to scaling your team will give lenders confidence to know that your loan will be put to good use.
Once you know you qualify for an SBA loan, the next step is learning what type of SBA loan to pursue. There are many options and finding the right one can sometimes be tough, so the best bet is to get in touch with our SBA professionals to talk about your business needs, and what makes most sense for you and your business’ future.