SBA 7(a) Loans
- Loan amounts between $151,000 – $5,000,000
- Loan proceeds can be used to acquire owner-occupied commercial real estate, construction of owner occupied real estate, business acquisitions, partner buyouts, refinances, and start-ups.
- The term / amortization will vary between 10 and 25 years depending on the use of proceeds (real estate loans are 25 years)
- We can look to finance up to 90% of owner-occupied real estate transactions
- For business acquisitions, we can finance 90% or 75% of the purchase depending on the amount of intangible assets included in the purchase.
- For partner buyouts, we can finance the entire buyout if the Borrower’s existing ownership is more than 25% (15% in some cases).
- If the Loan to Value exceeds 85% for any loan, then the bank will place liens on the Borrower’s personal real estate (residence, vacation homes, investment properties). The liens on personal real estate will most likely be required for any non-commercial real estate loans
Typical Candidates
- The company must be buying something. A business for example
- Ex: An existing Laundromat purchase that is cash flow positive.
- Other examples: Gas Stations, Hotels, Restaurants, and much more.
Other Information
- Cash flow will be analyzed on tax returns. Existing companies with positive cash flow, enough to cover debt payments and the new loan payments. (To be analyzed. Depreciated expenses, Interest Expenses, and Amortized items to be added back when considering income)