Starting a small business can be challenging, and getting the right amount of funding to get your business off the ground can seem downright impossible. Luckily, the Small Business Administration (SBA), operated by the federal government, can help entrepreneurs get their businesses up and running.
One of the biggest benefits of the SBA is by helping entrepreneurs secure loans when other banks have turned the entrepreneur down. The SBA doesn’t lend its own money, rather, it partners with lenders and guarantees loans to small businesses. This means that lenders are taking less of a risk by giving an SBA-backed loan.
Since every business is different, the amount of time it takes to get an SBA loan depends on many variables. The process is very paperwork intensive and can take some time. Business owners will need to draft a detailed business plan, provide financial statements, submit credit checks, required business licenses, and resumes of all partners. It’s best to be very thorough when putting your paperwork together because any errors or missing information will only add to the time it takes for your loan to get approved.
Once all your paperwork is submitted, you’re at the mercy of the lender’s timeline. The standard period for an SBA loan is between 60 and 90 days, though larger loans might take longer. You can help speed up the approval process by carefully following the SBA’s application guidelines and using their business plan templates. Give the lender any further information they request.
Another benefit of getting a loan through the Small Business Administration is that they have counselors who can help guide you through the process of securing an SBA loan. They also have free resources like online training and guides on creating business plans that can help you get your paperwork ready for your loan application.