The Small Business Administration has financial assistance programs that provide access to debt and equity primarily from banks or other private sources. SBA-guaranteed loans may not be made to a small business if the borrower has access to other financing on reasonable terms. Small Disadvantages Business Designation – Businesses can self-represent this status by entering it into the System for Award Management. While drop shipping can sometimes be an option, especially for an at-home retail business operated through an online store, more realistically speaking, inventory needs to be purchased.
An SBA loan is backed by the Small Business Administration – a government entity dedicated to the growth of small businesses. However, the SBA does offer many types of grants programs indirectly to benefit small business entrepreneurs. SBA’s four basic loan programs are: Guaranteed Loans, Certified Development Company Loans or 504 Loan Program, Small Business Investment Companies, and Microloans.
Not to bore you with the details, but the only exceptions are almost minuscule, namely the guarantees are not used for business ventures involved in gambling, aquariums, zoos, golf courses, or swimming pools. Similar to the homeowner’s loan program mentioned above, small business owners pledge any available assets and acquire a similar pledge from a spouse or partner in the case of shared assets.
SBA loans typically offer flexible terms and conditions versus conventional counterparts. Most SBA loans take between 35 – 45 days if the lender is in the Preferred Lender Program (PLP). The SBA was established by President Eisenhower through the signing of the Small Business Act in the summer of 1953. The bottom line of any credit decision is whether a business can repay the loan and other obligations from earnings.
In some industries, a small business might have hundreds of employees – but most small businesses are much smaller than this. They will discuss different types of insurance for your business along with any other forms of assistance available for business owners and their companies.