SBA Loan Timeline and How to Apply in 2022

Many government lending programs and grants have been put into place to help small business owners weather the coronavirus pandemic. As the economy slowly improves, the emergency relief of PPP, EIDL, and other programs might not have enough to help you rebuild your business. A traditional low-cost SBA 7(a) loan can help you transition back into full operations by providing working capital or debt refinance. Different loan products have different timelines to funding. Although the SBA 7(a) loan application process may be longer than others, the low rates, long terms, and low monthly payments make it worth the effort.

Missed out on PPP? Pre-Qualify for other funding!

What is an SBA 7(a) loan?

The SBA 7(a) loan is the most popular type of SBA loan. The SBA doesn’t make these small business loans; it guarantees them. The maximum loan amount is $5 million, and funds may be used for working capital, real estate, equipment, or debt refinance. Interest rates are low and repayment periods are from 10 to 25 years.

SBA loan timeline

The SBA loan process generally takes between 60 to 90 days depending on the lender and loan size.

This isn’t much longer than other standard small business loans take. SmartBiz® has sped up the process and is typically faster, taking between 30 – 45 days.

The most time-consuming part of the process is often gathering the required paperwork. Because the loans are guaranteed by the government, more documentation may be required. Being organized and working with your accountant can help the process move more smoothly.

The SBA loan process

Since each business is unique, there is not a set-in-stone timeline for applying and funding. But generally, an SBA loan application follows these steps:

  • Business owner gathers documentation, and applies for loan (one to 30 days)
  • Lender underwrites the loan (10 to 14 days)
  • Lender approves the loan, and sends a commitment letter (10 to 21 days)
  • Lender closes on the loan (seven to 14 days)

Make sure you work with a lender who has strong customer service support. A loan application can be complex, and a responsive point of contact can help solve issues or answer questions.

Eligibility requirements to apply for an SBA 7(a) loan

Each lender has unique eligibility requirements for an SBA loan. For example, some lenders may require a business plan while others do not. (SmartBiz, for example, does not require a business plan).

  • Time in business must be above 2 years
  • Business owner’s personal credit score must be above 650 (675 for an SBA Commercial Real Estate loan)
  • The business must be U.S. based and owned by U.S. citizen or lawful permanent resident who is at least 21-years old
  • No outstanding tax liens
  • No bankruptcies or foreclosures in the past 3 years
  • No recent charge-offs or settlements
  • Current on government-related loans

Advantages & disadvantages of SBA 7(a) loans

Adding small business debt to your books - even an inexpensive SBA loan - is not a decision to be taken lightly. There are pros and cons to every type of loan product, from bank loans to lines of credit. It’s always a good idea to consult with a financial professional before you sign on the dotted line. Review these advantages and disadvantages of an SBA small business loan so you can make the best decision for your business.


  • Highly competitive, low interest rates
  • Long loan terms (10 years for traditional 7(a), 25 years for commercial real estate SBA loans)
  • Fixed and variable-rate options are available
  • A variety of businesses are eligible
  • Wide use of proceeds allowed
  • Most SBA loans, including 7(a) loans are fully amortizing, meaning borrowers don’t have to worry about balloon payments


  • Approval times can be lengthy
  • Lots of documentation required
  • Certain businesses, including real estate investing, lending, gambling, and speculation are prohibited
  • High credit scores are typically required

How to apply for an SBA 7(a) loan

Applying for an SBA 7(a) loan takes some work on a business owner’s part to submit accurate financial documents and other paperwork. Because of the COVID-19 pandemic’s effect on small businesses, SBA 7(a) lenders now have additional questions regarding how your business is operating.

Your best bet is to be as organized and prepared as possible and have realistic expectations about effort and timing. A good strategy is to work with your bookkeeper, accountant, or another small business financial professional to gather paperwork. Here are steps to help the process move smoothly.

1. Determine Eligibility

Before beginning your application, make sure that you meet basic eligibility requirements. You don’t want to invest your valuable time if you don’t qualify. Eligibility requirements, in addition to SBA requirements, can vary from lender to lender.

2. Prepare a Business Plan (Note: SmartBiz does not require a business plan)

Submitting a business plan is a unique opportunity for you to present a roadmap with concrete details on how you plan to achieve your goals. A business plan will help you set milestones to measure success and position yourself within your industry. You’ll give lenders an accurate picture of where you’re headed in the future.

3. Gather the paperwork

No matter which lender you’re working with, having all the necessary documentation is crucial to obtaining your funds as quickly and efficiently as possible. As you’re progressing through the application, you’ll need to demonstrate that you’re able to make regular payments. Some of the most common documents that our bank partners request include:

  • Personal & Business Tax Returns
  • Personal Financial Statements, required from each individual owning 20% or more of the company
  • Profit and Loss Statement
  • Balance Sheet
  • Collateral

4. Prepare for questions about your operations during the coronavirus shutdown

Since the pandemic, lenders will also want to know:

  • The industry you operate in and how it was impacted overall
  • How the COVID-19 pandemic has impacted your business
  • Changes you’ve put in place to mitigate the financial impact
  • How you will use the funds to rebuild

5. Connect with an SBA Loan Lender

Avoid going from bank-to-bank to find a lender who will approve your application. When you work with SmartBiz Loans, we’ll help you increase your likelihood of getting a “Yes” by matching you with the bank partner most likely to fund your business. See if you prequalify* by answering a few questions about your business and you’ll be on your way to applying for quick, easy, and transparent funding.

For additional information about SBA 7(a) loan applications, review this article from the SmartBiz Small Business Blog: 4 Ways to Prep for a Stellar Small Business Loan Application.

*We conduct a soft credit pull that will not affect your credit score. However, in processing your loan application, the lenders with whom we work will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and happens after your application is in the funding process and matched with a lender who is likely to fund your loan.

Final thoughts

The SBA loan process may take two to three months to come together from gathering documentation to funding. You’ll need to budget time to organize paperwork before submitting an application to streamline the process. Although SBA loans require more information from a business owner than other types of funding products, it’s worth it in the end. Once the application is approved, funds can be deposited into your bank account in as fast as 7 days. SBA loans are known as the best possible small business loan on the market. Ultimately, the savings will be worth your time.

WHAT YOU NEED TO KNOW: The SmartBiz® Small Business Blog and other related communications from SmartBiz Loans® are intended to provide general information on relevant topics for managing small businesses. Be aware that this is not a comprehensive analysis of the subject matter covered and is not intended to provide specific recommendations to you or your business with respect to the matters addressed. Please consult legal and financial processionals for further information.