The existence of the SBA's guarantee is an inducement for the bank to make loans on terms it would otherwise not make available. The key to successfully obtaining an SBA loan is being prepared and finding the right lender. It is important to know your needs and to explain how you arrived at the amount you are requesting. It is important to include monthly cash flow projections with a listing of critical assumptions. To be eligible for an SBA loan, a business must be small according to the SBA's size standards.
Most small businesses are eligible.
The borrower must also be able to repay the loan from the cash flow and profits of the business. Local banks and other select commercial financial firms comprise the distribution system for SBA loans. Contact your local SBA District Office for a list of lending sources in your area. There are many reasons why families fail to successfully transfer businesses from generation to generation. The primary cause for failure is lack of planning.