There is a lot of misconception about small business administration loans, and what they are meant to do. Once you read this article, you will understand what it takes to get this loan, as well as some sample reasons as to why.
This is a type of loan that is usually given out to already established businesses. They want to either expand, or need to do a total office upgrade.
Of course, this doesn’t have to be the reason, but they are the most common ones.
For some reason most people think this is the type of loan you would get BEFORE you start up your small business. However, they are quite mistaken.
This loan does not need a business plan, just a general outline of the last 2 years revenue, and profit. This should be pretty easy to do as long as you kept good records, and being in business, you should have at least had an accountant.
If you have not been in business for at least 2 years, with a good revenue flow, then it will be very difficult to get this type of loan, and you might be looking at getting a personal one instead.
The reason they look at your business and not you, is because the business is the entity requesting the money, so they have to base their answer on repay ability within the business it self. This would be like if you went and got a personal loan. They would look at your employment history, and make sure you make enough money to repay the loan.
Now that you have a better grasp on the truth around a small business administration loan, you will know if you qualify to even apply for this type of loan. Have you been in business for at least 2 years? And have a good revenue flow with good profit margins? If this sounds like your business, then you have the battle half way won already.