SBA Express Loan Program: Advantages

When looking to raise capital quickly for a small business, one of the more popular options is applying for an SBA Express Loan.  This fast business loan can be processed in under 48 hours sometimes, with amount available up to $350,000.00.  In addition to the fast turnaround time, this loan program also has many advantages.

Advantages of the SBA Express Loan

  • Available to most small businesses, regardless of gender or minority status.
  • The lender can use their own forms instead of the many SBA forms required for the 7(a) loan, making the processing time faster.
  • The first $25,000 of the loan can be unsecured, meaning no collateral is required up to this amount as long as the lender agrees.
  • Businesses that are unable to secure conventional credit under a reasonable term are potentially eligible.
  • Lower down payment requirements.
  • Eases cash flow because of extended repayment terms.
  • Reasonable interest rates
  • Loans may be prepaid, in whole or in part, at any time.
  • Provides access to funds that might not otherwise be available.
  • For SBA loan qualification, projected income of a business, not just historical cash flow, is considered, which is advantageous if a business is rapidly growing.
  • SBA Express loans are fully amortized, with no balloon payments at the end of the loan. This eliminates the need to apply for a new loan and incur new fees at the end of the loan term.

The SBA Express Loan is available to owner operated, for profit small businesses that conform to the SBA guidelines for small businesses.  The lender also looks to the following qualifications in order to approve:

  • Ability to repay based on projected cash flows and profits
  • Good credit history for all principals involved
  • A detail of collateral which may include a detail of a person's assets, or those of the business such as machinery and equipment, buildings, or other structures.
  • While express loans do not typically require as detailed of a loan proposal as other SBA backed loans, a detailed business profile with financial statements, loan request details, collateral, and personal financial statements from all partners will be necessary.  An accountant prepared cash flow statement or projection for new businesses is also acceptable.

For a rapidly growing small business, the SBA express loan program may be just the idea route to go to secure quick and accessible financing.  Commercial lenders can explain the options their firm provides so that  borrower can use the best financial situation.