It’s time to bust some SBA Loan Myths!
In this day and age, many people are terrified of getting a loan. These individuals have come to believe many myths associated with the process of getting a loan. These misunderstandings become a tragedy when they prevent people who may be qualified from even attempting to get an SBA loan. There is available funds out there that can be used to help a daring entrepreneur take that first step into starting a new business. In many cases all that this entrepreneur needs to do is take the time to apply. Debunking these myths can alleviate a lot of the fear and anxiety associated with applying for a business loan.
MYTH 1: There are many people that think that acquiring an SBA loan will require a lot of paperwork and it will take a lot of time. This is a myth. Small business owners who find the right lenders will be able to get this type of loan just as quickly as any other. There are many programs that can be utilized to speed up the process. These programs are automated, and they do not require an access fee. A program like this can reduce the amount of necessary paperwork, and make the entire process go more smoothly.
MYTH 2: Some individuals think that going to a bank is not necessary because they can get a loan directly from the SBA. Unfortunately this is not true. The SBA does not operate by providing grants to individuals who own small businesses. The SBA makes it possible for small business owners to acquire loans by issuing guarantees that decrease the risk involved in lending money to small businesses. An SBA loan must be acquired from a bank that has been given this guarantee.
MYTH 3: There are many people who believe that in order to qualify for this type of loan they need to have a perfect credit score. This is simply not true. Someone with low credit can qualify for this type of loan. It is also not true that these types of loans are associated with lots of fees and high interest rates. The SBA closely monitors interest rates, and they will limit the amount of interest that a lender can charge their customers. They also ensure that most borrowers will be able to get a fixed or floating rate of interest.
Once business owners begin to understand that applying for this type of loan is not going to be an overwhelming ordeal, they are usually more willing to attempt it. Acquiring an SBA loan also begins to seem more attractive once business owners realize that they can get lower fees, and excellent rates of interest.