What is an SBA 7(a) Loan?

SBA 7(a) loans are a flexible form of business funding backed by the U.S. Small Business Administration (SBA). The loan program provides small businesses with low-interest loans of up to $5 million that can be used for a range of purposes, including working capital or the purchase of equipment and real estate. ESU-Global will guide you through the complex application process. Borrowers should be aware that MOST SBA loans can take between 60 and 90 days from the submission of the application accompanied by ALL required supporting documents to closing and disbursement of funds.

Pros and Cons of SBA 7(a) Loans

SBA 7(a) loans offer eligible business owners access to flexible loans at capped rates. However, not all of the 7(a) loan programs are a good fit for borrowers who need fast access to cash. If you’re trying to get a business loan, make sure you understand the advantages and disadvantages of the SBA 7(a) loan program.

Pros of SBA 7(a) Loans

• Interest rates are capped by the SBA
• Borrowers can take advantage of longer loan terms
• Down payments are low and generally range from 10% to 20%

Cons of SBA 7(a) Loans

• Application process is cumbersome and requires extensive documentation
• Approval times are lengthy for standard 7(a) loans
• Certain types of businesses are not eligible
• Loans may require collateral
• Qualification standards are rigorous