Have you received an SBA Economic Injury Disaster Loan (EIDL) to support you through the coronavirus economic downturn? If so, you have additional options to help rebuild your business.
Low-cost SBA 7(a) loans can provide the working capital or debt refinance you need during this time. SBA loans are considered the “gold standard” in small business lending because they have the lowest rates, low monthly payments, and long 10-year terms with no prepayment penalties.
Here’s what you need to know about having an EIDL , how it impacts an SBA 7(a) loan application, and information about low-cost SBA 7(a) loans.
Can I get an SBA 7(a) loan if I already have an Economic Injury Disaster Loan (EIDL)?
Yes. You can get a traditional SBA 7(a) loan in addition to an EIDL loan.
When you apply for an SBA 7(a), the amount of your EIDL loan payment will need to be included in your debt schedule and cashflow statement you submit with your application.
A debt schedule outlines all financial debts you’re responsible for. This document tells a lender where the debt came from, how much is left to repay, what rate you pay on that debt, and the collateral backing those instruments.
A cash flow statement lists the cash funds that move in and out of a company’s accounts. For more information on cash flow, review: How to Calculate Small Business Cash Flow.
How much can I borrow with an SBA 7(a) loan?
SBA loans from banks in the SmartBiz network are available from $30,000 – $350,000 for working capital or debt refinance.
How can the funds from an SBA 7(a) loan be used?
Funds from an SBA 7(a) loan can be used for debt refinancing and working capital. Working capital includes operational expenses, marketing, hiring, etc. SBA loans can be used to fund new equipment purchases as well.
SBA loans can also be used for refinancing existing business debt not secured by real estate (such as cash advances, business loans, and equipment leases).
How long will it take to get an SBA 7(a) Loan?
SmartBiz's advanced software streamlines the SBA loan application process so small businesses can now apply online and get funds in as fast as 7 days. SmartBiz Relationship Managers are on hand to answer any questions and guide you through the application process.
Where can I apply?
You can apply for an SBA 7(a) loan through a traditional bank. If you work with SmartBiz Loans, they have a network of trusted bank partners who fund these loans. We’ll match you with the lender most likely to approve. You won’t waste time going from bank to bank.
Can I still get an SBA loan if I’ve been turned down by my bank before?
Yes. We have helped many small businesses obtain an SBA loan offered from a bank in the SmartBiz network even after they have been turned down by other banks.
What are the basic SBA 7(a) loan requirements for working capital or debt refinance?
Businesses that qualify for an SBA loan offered from banks in the SmartBiz network typically have more than $100,000 in annual revenue. Most of our customers are profitable and cash flow positive. All are able to show that they can afford to make our monthly loan payments.
- Minimum 2 years in business
- U.S. based business owned by a US citizen or Lawful Permanent Resident who is at least 21 years old
- Good personal credit score of 640 or higher
- No outstanding tax liens
- No bankruptcies or foreclosures in the past 3 years
- No recent charge-offs or settlements
- Current on government-related loans
What are the steps to apply for an SBA 7(a) loan?
- Check your eligibility on the SmartBiz Loans website
- Gather financial paperwork
- Fill out the streamlined, online application
Additional resources for affected small businesses
SmartBiz is dedicated to providing business owners with the information and support they need to weather the economic crisis. The SmartBiz Small Business Blog has the following resources and more to help you get back up and running.
- How to Prepare Your Small Business to Start Up Again After the Shutdown has Lifted
Tips include financing options, operation strategies, and how to avoid coronavirus scams.
- COVID-19 Grants Available to Small Businesses During the Pandemic
Review these funding options available from large corporations, non-profits, and local governments.
- Solving Small Business Cash Flow Issues Due to Coronavirus
Here are reasons you should pay attention to your cash flow to strengthen your business during the COVID-19 outbreak.