The Small Business Administration enters into partnership with multiple lending organizations in order to provide diverse loans to the startup companies. In fact, this organization does not offer them directly to these companies, but this type of organization gives the guarantee that a certain portion of their total amount will be paid back by the organization even if they are unable to pay them back within the scheduled period of time.
Unlike the traditional lending organizations, this organization usually does not verify the business records of their borrowers prior to the money lending procedure. It means that anyone who suffers due to poor credit record has the scope to get this kind of fund without any kind of difficulty. This article will highlight on different types of SBA loans that are available for the borrowers in order to fulfill their requirements in the best possible way.
SBA 7 (a) loan is designed with the purpose to provide money to the borrower who wants to buy devices or furniture or who want money for other purposes such as house renovation, debt repayment and so on. Its maturity is ten years for repayment of capital and its period of repayment is twenty five years.
SBA 504 loan is often used for multiple purposes such as purchase of fixed assets, renovation of fixed assets and so on. Its amount varies from one million dollar to four million dollars. Unlike SBA 7 (a) loan, it is designed where the Small Business Administration provides forty percent of its total amount and the borrower pays ten percent of its total amount as collateral. It is vital to remember that this type of fund is used for development of the community while the other types of funds are used for development of business in the rural areas.
Unlike other kinds of funds, the Small Business Administration employs a different approach with their microloan programs. If you want to acquire this type of fund, there is a possibility that this type of organization does not give money directly to the borrowers. In fact, this kind of organization offers money to the non-profit associations who often lend money to the startup companies at their discretion. Its amount is thirty five thousand dollars and its term is six years. It is vital to remember that this kind of fund cannot be used for repayment of existing debt or for purchase of valuable property. In fact, it can be used in order to fulfill diverse business purposes such as purchase of equipment, devices, capital and so on.If you acquire this type of fund, it is vital that you should be able to enjoy a few important benefits such as a fast application process, lucrative amount, flexible terms and variable rates of interest.
Those who have faced disaster can get the disaster fund that is offered by the Small Business Administration. In fact, this type of fund can be utilized in order to repair the device, damaged property and other relevant purposes.