Are you an SBA-approved lender? If so itâ€™s a good idea to have some comprehensive content around how SBA loans work, as the process can be quite confusing for business owners.
For example, itâ€™s important to explain that the moneyâ€™s still coming from you â€“ the bank â€“ the SBA doesnâ€™t provide the funds. What they do is guarantee the loan to the bank, so it reduces the risk to the bank if they canâ€™t meet their repayment obligations.
So SBA loans are really handy for business owners who might have trouble qualifying for a traditional loan. If they donâ€™t have enough collateral, or years in business to justify the loan, the SBA can help.
The SBA offers a number of different loan programs, from general lending to funds for disaster recovery. If youâ€™ve turned down a customer for a traditional loan, you may decide to guide them towards the SBA. Depending on the reason for the loan and their business profile, they could be eligible for a SBA loan.
Encourage them to check their credit history, so that if there are any blemishes, they can fix them ahead of time. If there are inaccuracies, then they need to clear them up. Itâ€™s essential that they know what your credit report looks like, so that theyâ€™re well prepared to explain it to the bank and the SBA.
At the end of the day, itâ€™s all about due diligence. The better prepared they are, the more streamlined this sometimes difficult process will be. Remembering that the funds are coming from you, itâ€™s a good idea to sit down with your small business customers and carefully go through their application to make sure they havenâ€™t missed anything out.
Here at TSBC, weâ€™ve got plenty of content around the SBA, including the different loan programs, eligibility and the application process. Get in touch with us so we can help boost your online content.
Glen is the founder and CEO of The Small Business Company, a New Zealand based agency that specialises in helping banks communicate with small businesses through content marketing. He has written a number of books on small business principles and is a sought after consultant and conference presenter.