SBA loans are some of the most popular loans in the financial world, and they’re extremely popular with small business owners who are hoping to achieve business growth and greater business success.
Here are some of the biggest advantages of securing an SBA loan.
Low interest rates
When your business is taking out a new loan, you should always be concerned about how much that loan is going to cost you. If you can find a loan which has low interest rates, you will be much further ahead of the game, because your monthly payment will be smaller. The interest rates on an SBA loan are pretty much the lowest rates available anywhere, which makes them very attractive from that standpoint.
Since most traditional banks have a much lower approval rate these days, it has become much harder for small business owners to secure available capital for business purposes. With the backing of the federal government, that capital is much more available from lenders, because it carries the security of having it backed by the government.
Favorable repayment terms
Another tremendous advantage of securing an SBA loan is that they offer the longest repayment terms, as well as a payment schedule which will allow your business to keep cash reserves intact. When you take out an SBA loan, you’ll have 25 years to pay back the loan if it’s a real estate transaction, 10 years if your loan is for equipment, and seven years if your loan was for working capital.
Low down payments
Although you can count on having to make a down payment for just about any kind of SBA loan you take out, you can also count on that down payment be lower than it would be for almost any other lending institution.
There are some types of SBA loans which are very flexible, in terms of what they can be used for. For instance, an SBA 7(a) loan allows you to use the capital for almost any business purpose, including purchasing inventory, refinancing debt, buying land, or making business improvements. Some other types of loans restrict your usage of loan funds to a single business purpose.
Is your company interested in securing an SBA loan?
If you’ve been considering an SBA loan for your company, we’d like to hear from you at Grecco Capital. We have worked with many small businesses on SBA loans, and we may be able to assist you as well, so your small business can achieve its goals and objectives.