Business SBA Loan Overview

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Created in 1953, the U.S. Small Business Administration (SBA) helps small business owners and entrepreneurs pursue the American dream. The SBA is the only cabinet-level federal agency fully dedicated to small business and provides counseling, capital, and contracting expertise as the nation’s only go-to resource and voice for small businesses. According to its website, the SBA works “to ignite change and spark action so small businesses can confidently start, grow, expand, or recover.”

In addition to their guidance, advice, and other SBA services, the Small Business Administration supports certain types of business loans for entrepreneurs and growing companies. Most forms of SBA lending don’t involve funds issued by the Small Business Administration itself, but through approved business loan companies. A large percentage of each qualifying loan is guaranteed by the SBA, meaning much lower risk for lenders – even if a borrower defaults, the lender recoups most or all of their money. The lower risk of SBA business loans means better terms for approved borrowers, including lower interest rates.

There are several general types of SBA loans. It’s helpful to be familiar with them before you business loan shop in order to make sure you’re applying for the loan or loans most appropriate for your circumstances.

7(a) SBA Loans – This is the best-known variety of SBA lending. These federally guaranteed loans can go as high as $5 million and be used for working capital, business expansion, equipment purchases, or many other business needs. A 7(a) SBA loan can be processed through participating banks or credit unions or numerous approved online lenders. Whether utilized as an SBA working capital loan or to expand or purchase essential equipment, the 7(a) is often an excellent choice for business financing.

CDC/504 Loans – These are commonly used to purchase real estate, buildings, or machinery. Amounts can go as high as $25 million, giving businesses great flexibility in securing high-end real estate or specialized equipment essential to their business growth. CDC/504 loans can be processed through private-sector lenders and certain approved non-profits.

Microloans – Typically, these are issued through nonprofit organizations and specialty lenders, including numerous online options, rather than traditional lending institutions like banks and credit unions. Microloans are geared towards very small businesses and beginning ventures. Much like the 7(a) loans, you can use microloans as a source for working capital. The maximum loan available under this program is $50,000.

Disaster Loans – As the name suggests, these loans are specifically designed to assist small businesses weather or recover from natural disasters. Unlike most forms of SBA lending, these loans are generally issued directly by the Small Business Administration. Loans can be approved for amounts as high as $2 million.

Whatever the type of SBA loan, they generally have much lower interest rates than traditional loans and longer repayment terms, based on their primary purpose more than on the loan amount. The SBA loan payment terms for an SBA working capital loan can be extended up to seven years. Repayment terms for an SBA business loan can be as long as ten years. Loans for real estate can be arranged for up to 25 years. The lower interest rates and longer repayment terms allow small businesses to use more of their available capital and devote fewer business resources each month to repayment.

Applying for an SBA Loan

The paperwork requirements for any of the types of SBA loans are generally more comprehensive than for a consumer loan or other traditional loan. Your top SBA lenders Most lenders will require tax returns, recent financial statements, a business plan (if a new business) or profit and loss statement (if established). Your personal and business credit history will be considered as well. Online lenders may request slightly less information, but you should be prepared either way.

Despite SBA backing, lenders will be deciding two things as they analyze your information. First, whether or not to approve the loan, and second, what kinds of terms to offer you if they do. While applying to more than one lender increases the paperwork involved, and applying to too many lenders can hurt your credit score, it may be worth applying to several lenders anyway in order to compare the terms each offers. Most business loans take longer to secure approval than most personal loans; SBA lending commonly takes 30 to 60 days and several stages of approval. Generally, the smaller the loan, the faster the process.

What Else Does the SBA Do?

The SBA began in 1953 during the Eisenhower Administration. Despite periodic efforts to eliminate it in the name of smaller government, it’s survived for nearly three-quarters of a century by pursuing the same basic goals for which it was established.

One of its biggest functions is to advise and mentor small businesses and individuals trying to start or grow their own small business. The SBA offers training programs throughout the year and around the U.S. In some cases, the Small Business Administration will organize one-on-one counseling services as well to help entrepreneurs with things like writing a good business plan or successfully applying for business loans.

On the SBA website, its primary functions are explained this way:

Access to capital – The SBA provides an array of financing for small businesses from the smallest needs in microlending to substantial debt and equity investment capital.

Entrepreneurial development – The SBA provides free counseling and low-cost training to new entrepreneurs and established small businesses in over 1,800 locations.

Government contracting – The SBA sets goals with other federal departments and agencies to award 23 percent in prime contract dollars to small businesses.

Advocacy – The SBA reviews Congressional legislation, testifies on behalf of small businesses, and assesses the impact of regulatory burden on small businesses.

Loanry® is here to help you get your Business Loans


Why Loanry?

There are many things your local bank or credit union probably does well. Everyone’s usually nice and sometimes there’s popcorn or bottled water or those little suckers you remember from when you were a kid. And it’s only natural when you’re looking to start a small, local business, to think “I should secure financing from one of the SBA lenders near me.” And you should absolutely start there and see what’s available to you as a local business.

Of course, you still have to work around the hours they’re open each day. You may have to sign in to speak to someone about something as specific as SBA business loans, and there’s no guarantee when they’ll be available. And if you have special circumstances, like needing an SBA loan for bad credit or other unique needs, you may find online lenders to be more flexible and responsive to your situation. It’s certainly at least worth including them when you business loan shop.

Thankfully, this is the 21st century, and lending doesn’t have to be the same as it was when your parents dressed up and promised you ice cream if you were good. The convenience and versatility of online lenders means you can submit your requests and fill out your information from any connected device, at a time and place of your choosing. In most cases, you’ll have your answers within less time than you’d think – sometimes within 24 hours. If you have the time to go through the SBA process, by all means, give it a shot. Don’t overlook the potential of the right online loan, however, on terms which may not be all that far removed from what you could get through an SBA. Online lending is a thing for a reason. It works for a lot of people in situations very much like yours.


Despite the additional paperwork, an SBA business loan can be an important tool in building your business and moving closer to your long-term financial goals. The advantageous terms and government support are specifically intended to promote small businesses across America – and that’s YOU. As you repay the loan, you’re strengthening your credit history. As you move your business forward, you’re solidifying your future and – hopefully -

The goal of any business loan, start-up or otherwise, is growth and prosperity. That’s why it’s important to be as honest with yourself as possible about your budget, your business plan, and the risks alongside the potential benefits. All entrepreneurship involves a roll of the economic dice, but the necessary gambles should always be strategic and measured. There are no guarantees in entrepreneurship, but there are different levels of acceptable risk and possible reward. Be bold, but don’t be delusional. Be determined, but don’t be reckless. Just because your lender is protected by SBA lending doesn’t mean your short and long-term credit can’t be impacted.

The good news is, that impact can be just as positive as it can be negative. By using your loan wisely and making your payments on time, you’re strengthening your credit history and that of your business. Strong credit means more options at better rates; weak credit means limited choices and paying more on what you borrow. Your business will need financing again at some point – to hire new people, to purchase equipment, to open another location, or to weather a downturn. You’ll eventually seek financial options for non-business expenses as well – to buy a car, purchase a home, pay for a wedding, or take the family on a much-needed vacation. The choices you make today, and each day going forward, will determine your options then.

The next time you need financing – and we all do, eventually – you’ll have even more options and be offered even better terms. It’s not just about the money; it’s about what the money let’s you do.


One of our goals here in the family is to connect you with reputable online lenders and to simplify your efforts to find reliable solutions to what sometimes turn out to be complex circumstances. Beyond that, however, we provide a setting in which you have the opportunity to explore your options in advance and the information which allows you to make better decisions.

That’s why we’re building more than a website. Our family of financial sites form what we think of as a “content mall” – a collection of financial knowledge and online tools. and are the most widely utilized to date. Each is about resolving your short or long-term financing needs, but they’re also about educating ourselves on how that credit works, the many different options associated with each, and how to best utilize – or avoid – loans and other forms of credit, now and in the future. simplifies real estate evaluation and helps you make more informed decisions about your property. At, we compare helpful debt to the unpleasant variety and look at ways to turn the latter into the former. is all about understanding your personal and small business taxes and maximizing your ability to navigate the ever-changing requirements of each. There are a half-dozen more, but you get the idea.

We have over a thousand informational blogs organized by topic and freely accessible from any internet-connected device you choose. Our video library is growing almost as rapidly. You can follow us on any of the major social media platforms to stay up-to-date and be part of the family yourself. When you’re ready, a single ID and password will help us best keep track of your goals and basic information as you navigate your way through. We know you’ll find some things you like.


Did You Hear?

“It is impossible to live without failing at something, unless you live so cautiously that you might as well not have lived at all, in which case you have failed by default.”

J.K. Rowling (Author of the Harry Potter book series)

Educate Yourself

Reasons An SBA Loan is a Great Way to Fund a Company

Small Business Administration loans are a promising option for any small business, whether just starting out or established and looking to grow. In this brief overview, we’ll break down the common types of SBA lending, the application process, major benefits of SBA lending, and the most common reasons applicants are rejected (in hopes that won’t be you).

If for some reason you ARE unable to secure an SBA loan, let us try to connect you to an alternative lender anyway – who knows what they might be able to offer instead! Loanry isn’t interested in telling you what to do with your business – it’s YOUR business, after all, and you’re the expert. We do believe, however, that the key to good decision-making is arming yourself with the right information in plain, simple English, and the opportunity to be connected with the right partners in moving your business forward. That’s OUR business, and as it turns out, we’re pretty good at it.

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Pros & Cons of Business SBA Loans

You’re considering a Small Business Administration loan to jump-start or grow your company. Is one of the many types of SBA loans the right one for you?

Pros: Start or Grow Your Business

Sometimes it’s just not going to happen without support from the Small Business Administration. SBA lending allows you to take advantage of favorable financing to make big things happen – for yourself, and for everyone impacted by your ideas.

Pros: Good Interest Rates

Because they’re largely guaranteed by the government, you’re more likely to secure favorable interest rates, whether you choose fixed-rate or variable-rate interest.

Pros: Generous Repayment Terms

Depending on the type of SBE loan you pursue, repayment can be spread out over longer time periods than traditional business term loans, leaving you more money every month to actually run your business.

Cons: Extra Paperwork

Applying for SBA loans requires more paperwork than some other loan types. SBA lending is a great opportunity, but it’s still the government, after all – of course there are more forms.

Cons: Difficult to Qualify

Because the SBA guarantees such a large percentage of the money borrowed, standards can be fairly high for borrowers to qualify. That doesn’t mean you shouldn’t apply – SBA loans for bad credit happen, but you may have to business loan shop a little harder.

Cons: Collateral or Personal Guarantees

Depending on your business’s credit history, you may be asked to provide collateral for the loan or otherwise involve your personal credit and personal guarantee. This means higher risk for you personally if anything goes wrong.

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We are a marketing lead generator and advertising service designed to provide you with quick and convenient access to third-party lenders.


We are a marketing lead generator and advertising service designed to provide you with quick and convenient access to third-party lenders.


We are a marketing lead generator and advertising service designed to provide you with quick and convenient access to third-party lenders.


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