Do you want to get a job? Buying new equipment or machinery? Expanding your business into a new market?
If so, an SBA loan may be right for you.
“It’s a good idea to think of SBA loans as expansion capital. The money can help take your business to the next level and increase your growth,” said Thomas Bennett III, president of First Bank of Oklahoma.
First Oklahoma Bank has a long history of partnering with the Small Business Administration and offers different types of SBA loans, the most popular of which is the 7(a) loan.
Simply put, an SBA loan is a small business loan that is partially secured by the Small Business Administration. Under the loan program, eligible borrowers can make lower down payments and have longer loan repayment terms than they would with a conventional bank loan. Borrowers can finance real estate up to 25 years, equipment up to 10 years, and long-term working capital up to 10 years.
Another common reason people look for SBA loans is the lack of collateral available to secure debt. Banks usually require the value of the collateral to exceed the loan amount. “This is not a requirement of the SBA,” said Ray Forman, chief lending officer at First Oklahoma Bank.
The Secured Loan Program 7(a) is the SBA’s core lending program. The maximum loan amount for a Class 7(A) loan is $5 million. The SBA typically guarantees 50% to 85% of a qualifying bank loan, with a maximum guarantee of $3,750,000. The exact percentage of the guarantee depends on various factors.
To be eligible for the loan program, a small business must meet the following requirements:
Be involved in or do business in the United States or its possessions
Proof of need for a loan
Learn the definition of a small business
Use the funds for a sound business purpose, among other criteria
Examples of eligible businesses include private medical facilities and equipment needs for dentists and other healthcare providers, pharmacies, heavy equipment franchises, owner-occupied commercial properties, veterinary practices, jewelry stores, technology, landscaping, attorneys, and manufacturing firms, among others.
Disqualified businesses include nonprofits, passive realtors, hierarchical sales, religious organizations, political or lobbying activities, corporations that restrict patronage, finance firms, and investment firms, to name a few.
“For business owners looking to purchase real estate, purchase a business partner, expand, start or acquire a new business, an SBA loan from First Oklahoma is an excellent option,” Forman said.
For more information, visit firstoklahomabank.com or call 918-392-2500. Member of the Federal Insurance Institute