Learn more about specific requirements you may have to meet to be eligible for an SBA loan through SmartBiz Loans.
LOANS UP TO
5.75% - 8.00%*
10 - 25 years
* Loans have a variable rate of Prime Rate plus 1.50% to 3.75%.
SBA Loan Requirements
Many small businesses from a broad range of industries can be approved for an SBA 7(a) loan. Rather than listing what businesses are considered for approval, the Small Business Administration lists those industries that are excluded, such as:
Primarily political and lobbying activities
Real estate development
Pawn or private clubs
For the detailed list of ineligible businesses, head to the SBA’s website to learn more.
If your business does not fall under one of the excluded categories, the next step is to meet the following common eligibility requirements for an SBA loan.
The business owner’s personal credit score must be above 675
The real estate must be majority owner-occupied
This means that at least 51% of the square footage of the property you’re buying must be occupied by and used by your business.
Sufficient business and personal cash flow to service all debt payments, demonstrated by 3 years of tax returns and interim financial data
No delinquencies and/or defaults on government loans
If considering our rent replacement option, this requires a loan payment that does not exceed the current monthly lease expense
Typically, businesses approved for an SBA loan through SmartBiz have $50,000 to $5 million in annual revenues and 1 to 40 employees. Most are profitable and cash flow positive. All can provide proof that they are able to make the monthly loan payment.
SBA 7(a) Loan - Uses of Proceeds
Depending on the amount you want to borrow, you can use the funds from an SBA 7(a) loan for a variety of purposes like refinancing high-cost debt, hiring, inventory, marketing, or purchasing commercial real estate.
$30,000 to $350,000: Loans of this amount can be used for working capital (such as operational expenses, marketing, hiring, etc.), new equipment purchases, and refinancing existing business debt not secured by real estate (such as cash advances, business loans, and equipment leases).
$500,000 - $5 million: Loans of this amount can be used for the purchase or refinance of commercial real estate that is 51% owner-occupied.
Not eligible for an SBA loan?
If you don’t meet the requirements to qualify for an SBA loan right now, we won’t leave you hanging! Instead, we’ll work with you to help you improve the critical factors of your business, like credit scores or cash flow, that can help you to qualify in the near future.
Check out our Small Business Blog for helpful resources about raising your scores and improving your likelihood of getting funded.