A one page overview of the SBA 7a umbrella of loan programs including the Patriot Express. Use the 7a program to secure working capital, real estate, add inventory, purchase equipment, and more.

1.
SBA
7a
Loan
Program
A
Quick
Reference
Guide
SBA
loan
specialists
helping
you
put
your
business
in
overdrive!
The
7a
program
is
the
Small
Business
Administration’s
main
method
to
support
startups,
as
well
as
to
facilitate
other
capital
needs
for
existing
businesses.
In
addition
to
traditional
7a
loans,
the
7a
umbrella
of
government
guaranteed
loans
includes
a
host
of
other
programs
for
veterans,
exporting,
working
capital,
and
other
special
initiatives.
QUALIFICATIONS
q New
or
existing
for-­‐profit
business
q Owner
occupied/business
use
q Tangible
Net
Worth
not
to
exceed
$15
million
q Net
Income
(
2
yr
avg)
not
to
exceed
$5
million
ELIGIBLE
USE
OF
FUNDS
q Working
capital
q Inventory
and
supplies
q Traditional
debt
refinancing
q Business
acquisitions
q Partner
buyouts
q Revolving
lines
of
credit
q Equipment
q Real
estate
purchase,
leasehold
improvements
INJECTION
REQUIREMENTS
FROM
BORROWER
q 10-­‐30%,
not
to
exceed
30%.
Injection
is
determined
by
credit
worthiness
and
lender’s
policy
PUBLIC
POLICY
GOALS
*Aids
in
reducing
job
creation
requirements/increasing
funds
q Rural
development
q Revitalizing
economic
development
areas
q Women,
minority,
or
veteran
owned
(51%)
q Expanding
exports
q Areas
impacted
by
federal
budget
cutbacks
q Sustainable
building/energy
reduction
of
10%
BENEFITS
TO
BORROWER
q Max
30%
injection
(usually
10-­‐20%)
q Cap
on
interest
rate
q No
balloon
payment
q Can
roll
in
certain
soft
costs
q 25
year
term
on
real
estate,
5-­‐10
years
all
other
q No
prepayment
penalty
under
15
years
BENEFITS
TO
LENDER
q up
to
85%
SBA
guarantee
q 1st
lien
position
q Can
take
additional
collateral
q Bank
issues
all
proceeds
q Available
for
sale
on
secondary
market
LOAN
PROGRAMS
AND
MAXIMUMS
q Basic
7a
~
$5,000,000
gross
q 85%
guaranty
for
loans
$150,000
or
less,
75%
guaranty
on
loans
over
$150,000
with
maximum
guaranty
of
$3.75
million
q SBA
Express
~
$350,000
q Guaranty
of
50%
q Revolving
credit
and
term
loans
q Faster
process,
streamlined
q Patriot
Express
~
$500,000
q 85%
guaranty
for
loans
$150,000
or
less,
75%
guaranty
on
loans
over
$150,000
with
maximum
guaranty
of
$3.75
million
q Available
for
all
active
and
retired
military/reservists
and
their
spouses/widows
q International
Trade
~
$5,000,000
q 90%
guaranty:
up
to
$4
million
for
working
capital,
$4.5
million
all
other
q Maturity
up
to
25
years
q Export
Working
Capital
~
$5,000,000
q 90%
of
guaranty
up
to
$4.5
million
q Maturity
generally
1
year
or
less,
can
go
up
to
3
years
q Export
Express
q 90%
of
guaranty
for
loans
$350,000
or
less,
75%
guaranty
for
loans
over
$350k
q Caplines
~
$5,000,000
q Includes
working
capital,
contract/seasonal,
and
builders
Caplines
q 85%
guaranty
for
loans
$150,000
or
less,
75%
guaranty
on
loans
over
$150,000
with
maximum
guaranty
of
$3.75
million
q Other
loans
include
Small
Loan
Advantage,
Small/Rural
Lender
Advantage,
and
Community
Advantage
*All
express
loans
require
an
approved
PLP
lender.
info@5thgearconsulting.com
210-­‐679-­‐4621
www.5thgearconsulting.com