How SBA loans can help your small business
As a small business owner, you’ve probably heard of the Small Business Administration (SBA). This is the federal government agency dedicated to helping start, build and grow small businesses in our communities. One of the ways they do this is to “guarantee” loans that banks make to small businesses. These are called SBA loans.
What makes an SBA loan different from other loans?
Because an SBA loan is guaranteed by the federal government, the loan is deemed to be less risky to finance from the bank’s perspective. As a result, banks are more likely to approve a loan that qualifies for an SBA guarantee – which is good news for small businesses. While you apply for an SBA loan at a commercial bank, like Webster, the loan is structured according to SBA guidelines. Compared to a conventional loan, SBA loans usually offer:
- Lower down payments in many cases
- Longer terms and amortization periods
- Financing for closing costs in many cases
What’s the difference between an SBA loan and an SBA 504 loan?
SBA loans are designed to meet specific business needs. 504 Loans are designed to assist small businesses in acquiring fixed assets such as real estate and equipment, and promote economic development in our communities. Here’s a link to the SBA's resource center that describes all the different loans available.
What does is mean to be the #1 SBA & SBA 504 lender in Connecticut?
Webster has partnered with the SBA for over 25 years. We are pleased to be the number one lender of SBA loans in Connecticut for the past six years, and the state’s number one lender of SBA 504 loans for the past twelve years.
“Our partnership with the local Connecticut SBA (and those in all the states where we conduct business) often allows us to say ‘yes’ in cases where we may have had to say ‘no’ in the absence of the SBA guarantee. This, in turn, helps our small business clients get the financing they need to grow,” says Bob Polito, Senior Vice President, Government Guaranteed Lending, Webster Bank.