SBA 7(a) Lenders For Startups

Part
01
of one
Part
01

SBA 7(a) Lenders For Startups

Some banks and other lenders that specialize in SBA 7(a) loans for startup companies include Huntington National Bank, Newtek Small Business Finance, Chase Bank, U.S. Bank, The Piedmont Bank, Regions Bank, Bank of America, 21st Century Bank, Central Bank and Pursuit Lending.

SBA 7(a) Lenders for Startups

1. Huntington National Bank

2. Newtek Small Business Finance, Inc.

3. Chase Bank

4. U.S. Bank

5. The Piedmont Bank

  • "Recognized as a preferred lender by the U.S. Small Business Administration (SBA)", the Piedmont Bank approves loan requests on behalf of the administration. They offer SBA 7(a) loans to for-profit small businesses such as independent and franchise businesses, retailers and other service businesses, wholesalers and manufacturers. The loan can be used to finance startups, expand businesses, or to buy or construct business facilities.
  • The minimum loan amount they offer is $200,000, whereas the maximum amount is $5 million. Moreover, their loan terms last from 10 to 25 years.
  • In 2020, The Piedmont Bank approved 6 SBA 7(a) loans, with an approval amount of $11.4 million. 

6. Regions Bank

7. Bank of America

8. 21st Century Bank

9. Central Bank

10. Pursuit Lending

SBA 7(a) Loans for Startups

How They Work

Who Provides The Loan
  • SBA 7(a) loans are government-backed loans for small businesses. However, they are not issued directly through the U.S. Small Business Administration (SBA). The SBA guarantees a percentage of loans that are provided through their lending partners, typically lending institutions such as banks and credit unions, among others. In this way, they make it less risky for the lenders to provide financing.
Eligibility Criteria
Guarantee Percentage
  • The SBA guarantees loans less than $150,000 up to 85% and those over $150,000 up to 75%.

Purposes

General Purposes
Land
  • SBA 7(a) loans can be used to buy land that will be used in the business for a specific purpose in the future. They can also include construction costs.
Debt Refinancing

Terms

Loan amount and maturity
Interest rates
  • SBA 7(a) loan range from 8% to 13% in general. Generally, if a loan is less than $25,000 with maturity less than 7 years, borrowers pay base plus 4.25%; and $50,000 loans maturing in over 7 years are base plus 2.75%. Interest rates are either fixed or variable.






Sources
Sources