two business owners looking at laptop
Small Business

Discover the power of SBA 7(a) loans to fuel your business growth today.

Fast, Flexible Funding to Fuel Your Business Growth

Are you a small business looking for financing to take your business to new heights? Midland States Bank, a Small Business Administration (SBA) Preferred Lender, is here to empower your business dreams with SBA 7(a) loans ranging from $25,000 to $5 Million. With our friendly and proactive approach, securing the funding you need has never been easier.

Background
Blue
a graphic of the white house and a dollar sign

What an SBA 7(a) Loan Is & How It Works

An SBA 7(a) loan is a government-backed loan program designed to provide financial assistance to small businesses. The SBA guarantees a portion of the loan, and that enables lenders like Midland States Bank to offer favorable terms and rates to borrowers. The Small Business Administration offers several popular loan programs such as the SBA 7(a) loan program and SBA 504 loans. The biggest difference between SBA 504 and SBA 7(a) loans lies in their primary purposes and the types of expenses they cover.

 

Background
Orange

About the SBA 7(a) Loans Program

  • Flexible Use of Funds: The SBA 7(a) program offers the most flexibility in terms of how the funds can be used. If someone needs financing for general business purposes, such as working capital, equipment purchase, real estate acquisition, debt refinancing, or business expansion, the 7(a) program is ideal.
  • Loan Amounts: SBA 7(a) loans offer financing ranging from $25,000 to $5 Million, providing flexibility to meet diverse business needs. If you need a larger loan compared to what other SBA loan programs offer, the 7(a) program may be the right choice for you.
  • Loan Types: Standard 7(a), 7(a) Small Loan, SBA Express, Export Express, Export Working Capital, International Trade, Preferred Lenders, CAPLines. For more information, see FAQs.

Apply for an SBA 7(a) Loan

Enjoy Lower Collateral Requirements & Longer Repayment Terms

The SBA 7(a) program typically requires less collateral compared to other SBA loans. If you have limited assets to offer as collateral, the 7(a) program may be a good fit for you. The SBA 7(a) loan program also offers extended repayment periods, making it easier for businesses to manage cash flow and repay the loan over time.

Apply for an SBA 7(a) Loan

Happy young businesswoman speaking on the phone while working in a warehouse
Background
Blue

Eligibility Criteria for SBA 7(a) Loans

While specific terms may vary, certain provisions generally apply to all SBA 7(a) loans.

  • Small Business Size: To qualify for an SBA 7(a) loan, the business must meet the SBA's definition of a small business, which varies based on the industry. Typically, businesses must have a tangible net worth not exceeding $15 Million and an average net income of $5 Million or less over the previous two years.
  • Business Type: The business must be for-profit and operating legally in the United States. Certain types of businesses, such as real estate investment firms and pyramid sales companies, are ineligible for SBA loans.
  • Owner's Equity: The business owner(s) is generally required to inject their own equity into the business before seeking an SBA loan. This shows a commitment to the venture's success and reduces the risk for the lender.
  • Personal Credit History: Business owners personal credit history is considered during the loan application process. While perfect credit is not always required, a good credit score enhances the chances of approval.
  • Business Performance: The SBA may assess the business's historical and projected financial performance to evaluate its ability to repay the loan.
  • Use of Funds: SBA 7(a) loans must be used for legitimate business purposes, such as working capital, purchasing equipment, refinancing existing debt, acquiring real estate, or funding business expansion.
  • No Federal Delinquency: The business and its owners must not have any outstanding federal debts or delinquencies, including tax liens.

.

You Have Questions, We Have Answers

SBA 7(a) loans can be used for various business needs such as working capital, business acquisitions, and equipment purchases. 504 loans are primarily for real estate purchases or long-term assets.

SBA 7(a) loans offer financing ranging from $25,000 to $5 Million, making them suitable for a wide range of business needs.

SBA 7(a) loans have versatile uses, including working capital, equipment purchase, business expansion, debt refinancing, and more. They cannot be used for speculative purposes or to repay delinquent taxes.

The approval process may vary based on the complexity of the loan application. Generally, it can take several weeks to a few months to complete the entire process. For a more detailed estimate, contact us today and a loan specialist will be happy to assist you.

SBA 7(a) loan interest rates can vary based on the prime rate, the loan amount, your creditworthiness, and prevailing market conditions. For a more detailed estimate, contact us today and a loan specialist will be happy to assist you.

While some collateral may be required, SBA 7(a) loans typically do not require full collateral coverage. The SBA does not decline a loan solely based on a lack of collateral.

Yes, startups are eligible for SBA 7(a) loans. However, they might need to provide additional documentation to demonstrate their business plan's viability and repayment ability. For more details, contact us today and a loan specialist will be happy to assist you.

Yes, SBA 7(a) loans generally do not have prepayment penalties, allowing borrowers to repay the loan early and save on interest costs. However, a prepayment penalty may apply for loans with longer amortization (15 years or more). Please contact our SBA Lending team at apply@sba.midlandsb.com for details.

Yes, the SBA 7(a) loan program allows refinancing existing debt, subject to certain conditions and limitations.

Background
Light Grey
computer screen with a midland square on it

Ready to Accelerate Your Business Growth?

It's important to note that your circumstances are unique and the best choice among SBA loan programs will depend on your specific needs and qualifications. Consulting with an SBA-approved lender like Midland States Bank can help you understand the available options and choose the most suitable loan program. Or, if you’re ready to get started, begin your application online today.

Apply for an SBA 7(a) Loan

.

Let's Connect.