SBA's mission is to stimulate and foster economic development through small business, because helping small business get started and become successful is good for the nation's economy. Briefly, the SBA loan guarantee program works in the following manner. The SBA will guarantee a portion of a business loan made by a lender enrolled in the program. By issuing a partial Federal Guarantee to the Bank, your loan which might not be approved on conventional terms can now be approved via a SBA guaranteed loan. Obtaining capital is the single most difficult hurdle a small business experiences.
Many business owners find cash flow to be a major concern.
For them an SBA guaranteed loan may be the only answer and possibly the best way of obtaining long term financing. Long term loans can be made for almost any business purpose to qualified applicants. SBA guaranteed loan terms typically range from 7 to 25 years depending on the purpose of the loan. The loan is fully amortized, and carries no pre payment penalty. SBA guaranties loans available to small businesses when they are unable to borrow on reasonable terms and conditions form other sources.