Qualifying for the SBA Express Loan Program with Bad Credit

The SBA Express Loan program is offered by the Small Business Administration (SBA) with the goal of making the process of apply for and obtaining a loan faster and easier. The SBA Express Loan program has less paperwork and a faster turn-around time than some of the other loan programs sponsored by the SBA.

The funding for an SBA Express Loan does not come from the SBA; rather, it comes from a third-party lender, typically a bank, who provides the loan with the SBA as the guarantor of it. In order to qualify for an SBA Express Loan you do not need to have perfect credit, and it is even possible for a small business with a bad credit rating to receive a loan. Having some basic knowledge of how the SBA Express Loan program works, before you apply, will be able to maximize your chances of receive a loan.   

The Role of the Lender

When you are ready to start thinking about applying for an SBA Express Loan with bad credit, you should first understand the role of the lender. You will need to apply for the SBA program directly to the lender, not the SBA. The lender must approve you for the loan before the SBA can. The lender has a lot of power over whether or not you will receive a loan, so it is good to know exactly what the lender is looking for in a borrower.

The Application Process

In order to apply for an SBA Express Loan you will need to speak to the lender and get the appropriate forms. Some of them will be forms issued by the SBA while others may be lender-specific forms. On all of your forms be honest. It may be tempting to try to hide your credit past, but it will only land you in a position to not receive a loan as the lender will not look upon your business favorably upon realizing that you have distorted the truth. Furthermore, make sure that you have a plan for what you will do with the SBA Express Loan.

You are allowed to use the funds in a number of ways including: to purchase machinery or other necessary goods, to purchase land for your business, or to renovate or convert existing buildings that your business owns.  Have a clear plan and a statement of your future visions regarding your small business. Let the lender know that you are serious and, despite having bad credit, have learned from your mistakes and have what it takes to be a successful small business owner.