If you run a small business you no doubt have run into circumstances where you need additional funding for your company.
You can seek out this funding from venture capitalists, which has its own set of issues, or you can look for a loan.
If you've been looking for a loan you've probably heard the term SBA loan thrown about.
Today we will be discussing what a loan of that type is, and what to expect from it.
The Small Business Administration or SBA is a government run institution designed to assist small businesses.
It is a common misunderstanding that the SBA provides loans, this is not the case.
When someone refers to an SBA loan they are actually referring to a loan from a private lender or bank which has meet certain criteria set out by the SBA.
This standardized set of criteria allow the lender and the borrower to have certain expectations walking into the negotiations.
This can be very helpful especially for new borrowers.
In this way they know what they will have to accomplish before getting a loan, and they will also have some assurance that the loan they are getting will meet these guidelines and won't be a really bad deal either.
It is very win win between borrowers and honest lenders.
So if you want to get a loan the best place to start is the SBA.
They can walk you through all the steps necessary to get a loan that meet their criteria and also assist you in accomplishing these milestones.
For example, they have consultants that can help you build a business plan, a minimum requirement for a loan approved by the SBA.
Not only will you get better terms, you will also get an education in the process, both of which will help your business, even more than the actual funds will.