SBA Bridge Loans

SBA Lending Is Traditional Bank Rate Lending Provide by Large Banks, Small Banks, Community Banks, Credit Unions and Non-Profit Community Lenders to Small Businesses as Part of The U.S. Small Business Administration’s Lending Program. The Government Will Approve Specific Lenders to Be SBA-Preferred Lenders, And Then Those Banks Will Provide Financing to Companies That Meet the Small Business Administration’s Definition of Small Business, And If They Meet Certain Financial and Business Criteria. In Return for Providing Financing to The Small Company, The SBA Agrees to Cover A Large Percentage of The Lenders’ Losses If the Small Business Fails to Repay the Loan. The Purpose of The Program Is to Increase the Availability of Funding to Small Businesses by Reducing the Lenders’ Risk, thus: Provide Quality Financing to Companies That Wouldn’t Get Approved for Financing Otherwise. SBA Loans Are Offered as Either A Term Loan Ranging From 3-25 Years or A Line-Of-Credit.

The SBA Lending Process Can Slow and Drawn-Out. Of All the Small Business Lending Options, An SBA Loan Requires More Paperwork, And the Approval Process Can Take Longer Than Any Other Form of Commercial Financing. Usually the Process Starts with A Lender Looking at A Company’s Financials as Well as The Owners Finances. All Owners With 20% Or More Of Equity Share in A Company Will Have to Submit Personal Financials to The Bank and The Small Business Administration in Order to Secure Financing.

After Submitting All Business and Financial Information to The Bank, The Lender Will Then Business Loan Application Checklist and Figure Out If the Company Meets the Most Basic Requirements to Qualify for Financing. Some of The Requirements Include:

In Order for The Lender to Start the Underwriting Process for SBA Lending, They Will Need Specific Documents to Figure Out What the Company’s Ability to Repay New Debt Will Be, As Well As Possible Savings by Consolidating and Refinancing Another Higher-Interest Debt. To Begin This Process, The Documents Lenders Would Need Are:

  • 3 Years Business Tax Returns
  • 3 Years Income Statements
  • 3 Years Balance Sheets
  • 3 Years Personal Tax Returns
  • Schedule of Business Debt
  • A/R And A/P Aging Schedules
  • Personal Financial Statement
  • Appraisals

Frequently Asked Questions

Get the Answers you Need to Common Questions About SBA Bridge Loans. Everything you need to know about SBA Bridge Loans and How your Business can Qualify.

What is an SBA bridge loan?
The Small Business Administration’s Express Bridge Loan Program is a quick way for small businesses affected by Covid-19 to get up to $25,000 to cover operational expenses. Eligible businesses must be based in the United States and be able to prove harm from coronavirus.
What do businesses use a bridge loan for?
Bridge loans “bridge” the gap and disparities that often appear in emergencies such as COVID-19. They’re temporary loans that provide fast economic support to small businesses to help them during a short-term loss of revenue.
How much is a bridge loan?
You can access up to $25,000 via an SBA Express Lender. The exact amount of your bridge loan will depend on multiple factors.
Who qualifies for a bridge loan?
If you’re a small business in the U.S. affected by COVID-19, you might qualify for a bridge loan. You must also show that you do not have the ability to obtain a similar loan via non-federal sources (including your SBA Express Lender). This is a “credit elsewhere” caveat. If you can show that you can obtain some of the funds, you may still qualify. For example, if you can show that you can secure $10,000 of a necessary $25,000 loan elsewhere, you might qualify for $15,000 in a bridge loan.
What are the terms of the loan?
The EBL loan is a term loan, and revolving credit lines are not allowed. The maximum loan term is 7 years. You may need to pay part or all of the EBL loan immediately if you later get approval for long-term disaster financing (such as the SBA Direct Disaster loan) if the loan allows for EBL loan reimbursement.