REFERENCE CHANNELS

SBA Low-Doc Loan Program

<<Back to SBA Index

If you've got pretty good credit, this is a program to consider. Your first contact will be the lender, either a bank or a small business investment company (SBIC) that is a preferred lender with the Small Business Administration. The loan must be either to start or grow the business and the business must:

• Employ no more than 100 people
• Average sales for the past three years have been less than $5 million dollars
• The business has good credit
• The owners have good credit
• The owners have good character

Your loan cannot be denied just because you don’t have enough money or property to meet the LowDoc loan guarantee requirements, although anyone who owns 20% or more of the business will also have to personally guarantee the loan. The business itself will be judged on its ability to repay the loan from operations. Once you’ve met a lender’s requirements for credit, the SBA will respond within 36 hours of receiving a complete application. Guarantee fees of 2% (for loan guarantees under $80,000) and 3% (guarantees over $80,000) will be charged.

Program Features:

• Lender makes decision
• SBA reviews it using credit scoring
• Average loan amount exceeds $57,500
• One page loan application
• Electronic loan processing
• Maximum loan amount $150,000
• Usually for 5 – 10 years
• Fixed asset loans, such as manufacturing equipment, may extend to 25 years

If you’re turned down for a LowDoc loan guarantee and you think you should have qualified, you can have the SBA field office in your area review the decision using either LowDoc appeals process or the 7(a) appeals process.

For more information, go to http://www.sba.gov/financing/frlowdoc.html

<<Back to SBA Index