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How to Expand or Start a Business
with SBA Government Guaranteed
           Financing
      Presented by: Mortgage West
  ...
SBA Business Financing

   Small Business Administration
   Benefits of SBA Financing
   Types of Loans Available
   A...
Small Business Administration

   Works in Partnership with the Bank
   Encourage Banks to Lend to Business by
    Guara...
Mortgage West
                                Real Estate Financing




   We Have Access to the Small Business Loan Exch...
Benefits of SBA Financing

    #1 Benefit; Access to Capital
   Longer terms 7 to 25 Years
   Competitive Interest Rates...
Available Loan Programs

   7(a) Loans
   Patriot Express
   504 Loans
Allowable Use of Funds

   Start up Costs            Business Acquisition
   Hard and Soft Costs       Partner Buyout
...
7(a) Loans

   Bank loans money, SBA guarantees up to 75% of
    the loan amount. (Currently 90%)
   Loans up to $2,000,...
7(a) Loans Terms and Fees

   Minimum of 7 years; depends on lease
   Equipment, 10 -15 years
   Real Estate up to 25 Y...
7(a) Eligibility

   Must be for profit and legal
   Must be a small business; < $8 million net
    assets & < $3 millio...
What’s Not Eligible

   100% Gaming, less than 20% of Revenue
   All Lending Companies
   Pawn Shops
   Adult Business...
Patriot Express

   Same as 7(a) but for Veterans
   Maximum Loan to $500,000
   SBA Guarantee up to 85%
   Fixed Term...
504 Loan Program

   Real Estate Purchase or Construction and
    Expensive Equipment with 10 year Life+
   Minimum is $...
504 Eligibility

   Same as 7(a) +
   No more than $8MM in net assets
   Fixed 1st 5 years, Adjustable based on Index
 ...
6 C’s of Underwriting

   Credit
   Capital
   Collateral
   Cash Flow
   Capacity
   Character
   The Probability ...
Loan Package Components

   Business Plan
   Tax Returns
   Financial Statements
   Use of Proceeds
   Statement of E...
Other Factors

   Time in Business
   Owners Cash Investment
   Success of Industry
   Resumes of Key Employees
   Lo...
Eligibility

   Restaurants?                          Yes
   Start up Business?                    Yes
   Equipment Pur...
Financing Options

   SBA Loans $150,000 to $8 Million
   SBA Revolving Lines of Credit $350,000
   Commercial Real Est...
How to Obtain Financing

   Initial SBA Eligibility Consultation
   Review Retainer Fee Agreement & Form 159
   Complet...
Questions and Answers

1. Complete SBA Compliance Agreement
2. Schedule Appointment for SBA Eligibility Consultation

    ...
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Small Business Financing & SBA Loans

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A general overview of the newly expanded guidelines for SBA financing that the current administration now offers. Learn how to qualify your business for SBA government guaranteed financing.

Published in: Economy & Finance, Business
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Small Business Financing & SBA Loans

  1. 1. How to Expand or Start a Business with SBA Government Guaranteed Financing Presented by: Mortgage West Lane Adler, Broker Telephone: (818)-882-LEND (5363) http//www.mortgagagewest.net
  2. 2. SBA Business Financing  Small Business Administration  Benefits of SBA Financing  Types of Loans Available  Allowable Use of Funds  Underwriting and Eligibility Issues  Other Financing Options  How to Apply  Questions and Answers
  3. 3. Small Business Administration  Works in Partnership with the Bank  Encourage Banks to Lend to Business by Guaranteeing the Loan  Old Myths vs. New Process  Small Business Development Centers  Promote and Support Business Expansion  Established 1954  www.sba.gov
  4. 4. Mortgage West Real Estate Financing  We Have Access to the Small Business Loan Exchange With 100 + Banking Partners available to you and Funding in all 50 states.  Our Managing and Regional Directors Have 30+ Years Experience in Many Areas of Financing, Including Commercial and Residential.  Our Goal: To Help Small Businesses to Increase Their Income and Save Money Through Government Guaranteed Financing.
  5. 5. Benefits of SBA Financing #1 Benefit; Access to Capital  Longer terms 7 to 25 Years  Competitive Interest Rates  Easier Qualifying Guidelines  Lower Payments  Start up and Established Business’ OK  Low Down Payment, 10% to 30%  Can be Assumable, SBA Approval
  6. 6. Available Loan Programs  7(a) Loans  Patriot Express  504 Loans
  7. 7. Allowable Use of Funds  Start up Costs  Business Acquisition  Hard and Soft Costs  Partner Buyout  Working Capital  General Business  Real Estate Purchase Expansion  Equipment  Machinery  Franchise Purchase  Inventory  Refinance Existing  Payroll Debt  Advertising
  8. 8. 7(a) Loans  Bank loans money, SBA guarantees up to 75% of the loan amount. (Currently 90%)  Loans up to $2,000,000, guaranteed loan amount is $1,500,000  Use for commercial real estate purchase, construction, improvements, debt refinance, equipment purchase, working capital, business expansion, revolving line of credit
  9. 9. 7(a) Loans Terms and Fees  Minimum of 7 years; depends on lease  Equipment, 10 -15 years  Real Estate up to 25 Years  Fully Amortized, no Balloon or Call  Declining Pre Payment Penalty 5,3,1  Adjustable Rates, Prime + Margin or LIBOR + 3 + Margin  SBA Guarantee fee to 2 - 3.5% (Currently Waived)  Form 159 Packaging Fee, $2,500  Other Third Party Fees
  10. 10. 7(a) Eligibility  Must be for profit and legal  Must be a small business; < $8 million net assets & < $3 million average revenue  For Real Estate must be 51% owner occupied, 60% new construction  Not a Felon  Citizen or Permanent Resident Alien
  11. 11. What’s Not Eligible  100% Gaming, less than 20% of Revenue  All Lending Companies  Pawn Shops  Adult Business’  Apartment Complexes  Pure Investment Properties  Mini Storage
  12. 12. Patriot Express  Same as 7(a) but for Veterans  Maximum Loan to $500,000  SBA Guarantee up to 85%  Fixed Term or Revolving Line of Credit  Disabled Vets, Current or Widowed Spouse,  Reservists and National Guard  51% Ownership
  13. 13. 504 Loan Program  Real Estate Purchase or Construction and Expensive Equipment with 10 year Life+  Minimum is $250,000  Maximum Project Cost $8MM  50,40,10 Loan  Bank Lends 50%,SBA/CDC Lends 40%  Borrower Invest 10%  Must be Owner Occupied Property
  14. 14. 504 Eligibility  Same as 7(a) +  No more than $8MM in net assets  Fixed 1st 5 years, Adjustable based on Index Flexibility- 3/1, 5/1 25 year amortization  Fixed 2nd 20 year Term  Prepayment Penalty on Both Loans
  15. 15. 6 C’s of Underwriting  Credit  Capital  Collateral  Cash Flow  Capacity  Character  The Probability of Success.
  16. 16. Loan Package Components  Business Plan  Tax Returns  Financial Statements  Use of Proceeds  Statement of Equity  Credit Reports  Supporting Documents
  17. 17. Other Factors  Time in Business  Owners Cash Investment  Success of Industry  Resumes of Key Employees  Location Lease  A Bigger Package is Better  Compensating Factors
  18. 18. Eligibility  Restaurants? Yes  Start up Business? Yes  Equipment Purchase? Yes  Practice Expansion, Partner Buyout? Yes  Land Purchase and Construction? Yes  Permanent Resident Alien? Yes  Working Capital? Yes  Real Estate Purchase? Yes
  19. 19. Financing Options  SBA Loans $150,000 to $8 Million  SBA Revolving Lines of Credit $350,000  Commercial Real Estate Loans $52 Million
  20. 20. How to Obtain Financing  Initial SBA Eligibility Consultation  Review Retainer Fee Agreement & Form 159  Complete Preliminary Application  Letter of Intent Issued  Complete SBA Application  Submit Documentation to Lender  Funding within 45 Days  Funds Received – Wire or Check
  21. 21. Questions and Answers 1. Complete SBA Compliance Agreement 2. Schedule Appointment for SBA Eligibility Consultation Contact Lane Adler Telephone: (818)-882-9205 email: sba@mortgagewest

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