The Various Types of SBA Bank Loans and Their Benefits

The United States Small Business Administration offers loans to the small businesses that do not fulfill the criteria required to obtain loans from financial organizations and banks. These loans aim at strengthening as well as improving the financial situation of the country by helping in the growth and development of the small businesses. There are different ways the business owners can take advantage of these loans. Here are a few benefits of acquiring business loans offered by the SBA.

You can easily acquire these funds even when you do not have properties that can be used as collateral. The Small Business Administration offers complete assistance by acting as your guarantor.

These funds may be acquired quickly and that too without difficulty. In fact, you can get the fund the moment you ask for it.

The business owners usually do not have an adequate amount of money in their hands. They are in dire need of money at different phases of establishing the business than the popular ones. Therefore, SBA offers loans at low interest rates to make the payment of debt easier while setting up the business.

These funds can be easily obtained from the Small Business Administration. They have to set up the rules as well as guidelines that should be followed by different banks as well as private lenders that offer these funds under the agreement of the organization. In fact, the organization offers diverse loan programs that are effectively designed to cater to the financial situation of different businesses. Here are a few categories of SBA loans available for the users.

SBA 504

These funds are used for different purposes such as buying properties, devices, buildings and other purposes. They are not used to refinance the existing credits. Unlike the conventional sources, these loans have a longer maturity period. Plus, the SBA has set up flexible eligibility criteria as well as loan terms. These funds also have low down payment requirements on the fixed assets. If you avail this loan you can get a minimum of 350,000 dollars without maximum limit.

SBA 7 (a)

These funds are acquired for buying a new business or even expanding the existing one, buying machineries as well as refinancing the current debts. The benefits of these funds are similar to the funds offered by the SBA. The benefits include longer periods of maturity than the conventional loans, decreased down payment needs on the fixed assets and convenient eligibility criteria than the traditional loans. The total amount of the loan varies from 350,000 to more than three million dollars.