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Small Business Loans

Government funded loan programs are some of the most common lending options for established businesses, growing businesses, or those who are just starting up.

Our experienced team of business bankerswill work closely with you and local Certified Development Companies to find a small business loan that best fits the needs of your business.

Community First Bank commonly offers three types of Small Business Administration loans to our clients:

  • SBA 7(a)Loans
  • SBA 7(a) Express Loans
  • SBA 504 Loans

To find out which type of government-backed business loan fits the needs of your business, or additional lending options available to you, reach out to our Business Banking department at (509) 222-2259.

Small Business Loan Types

SBA 7(a) Loan

What is an SBA 7(a) loan?

The most common loan program offered by the Small Business Administration, a SBA 7(a) loan is a business financing option that aids small businesses with special requirements.

The 7(a) loan program offers financing of up to $5 million if eligible for this loan type [1].

Common uses for an SBA 7(a) loan include:

  • Business Real Estate Purchases
  • Short- and long-term working capital
  • Refinancing current business debt
  • Purchasing of furniture, fixtures, and business supplies

To be eligible for a 7(a) loan, your business will need to:

  • Be operating as a for-profit business
  • Be considered as a small business, as defined by the SBA
  • Be engaged in, or propose to do business in the United States or its possessions
  • Have reasonable invested equity
  • Use alternative financial resources prior to seeking financial assistance, including personal assets
  • Be able to demonstrate a need for a loan
  • Use the funds for sound business purposes
  • Not be delinquent on any existing debt obligations to the U.S. government

How can an SBA 7(a) loan be used?

An SBA 7(a) loan can be used for:

  • Revolving funds based on the values of existing inventory and receivables
  • Establishing a new business or assisting in the acquisition, operation or expansion of an existing business
  • Purchasing of equipment, machinery, furniture, fixtures, supplies, or materials for your business
  • Purchasing of real estate, including land and buildings, for your business
  • Construction of a new building or renovation of an existing building
  • Refinancing existing business debt, under certain conditions

How to apply:

Based on loan eligibility standards and they status of your business, certain financial documents will be needed to apply for a SBA 7(a) loan [2].

Such documents may include:

  • Borrower Information Form
  • Personal Tax Returns from previous three years
  • Personal Financial Statements
  • Business Tax Returns from previous three years
  • Business Financial Statements
  • Business Certificate/License

Though based on your business and its needs, further documents may be needed.

Community First Bank’s experienced business bankers work closely with Certified Development Companies (CDCs) around Washington state to ensure that your business is qualified for a SBA 7(a) loan and you have all the required documents to successfully apply for the loan.

SBA 7(A) Express Loan

What is an SBA Express Loan?

The SBA Express loan is part of the SBA 7(a) loan program, though differs from a traditional 7(a) loan in the speed in which an Express loan can be granted and a lending maximum limit of $500,000 (compared to a traditional 7(a) loan limit of $5 million) [3].

This is a great option for small businesses who need a smaller government-backed loan in a short amount of time.

To be eligible for an SBA Express loan, your business will need to:

  • Meet the SBA’s definition of a small business
  • Be operating as a for-profit business
  • Have a reasonable owner equity to invest (this includes all owners who share at least 20% equity of the company)
  • Use alternative financial resources prior to seeking financial assistance, including personal assets

How Can an SBA Express Loan Be Used?

Similar to the traditional SBA 7(a) loan, the SBA Express loan can be used for the following purposes:

  • Revolving funds based on the values of existing inventory and receivables
  • Assisting in the acquisition, operation or expansion of an existing business
  • Purchasing of real estate, including land and buildings, for your business
  • Refinancing existing business debt that no longer meets the need of your business
  • To improve debt service coverage by 10% or more

How To Apply:

Based on loan eligibility standards and the status of your business, certain financial documents will be needed to apply for a SBA Express loan.

Such documents may include:

  • Borrower Information Form
  • Personal Tax Returns from previous three years
  • Personal Financial Statements
  • Business Tax Returns from previous three years
  • Business Financial Statements
  • Business Certificate/License

Though based on your business and its needs, further documents may be needed.

Community First Bank’s experienced business lenders work closely with Certified Development Companies (CDCs) around Washington state to ensure that your business is qualified for a SBA Express loan and you have all the required documents to successfully apply for the loan.

SBA 504 Loan

What is an SBA 504 loan?

The Small Business Administration’s 504 Loan Program offers a long-term, fixed rate financing for major fixed assets to use towards promoting the growth of your company as well as job creation.

The 504 loan program offers financing of up to $5 million if eligible for this loan type [4].

To be eligible for a 504 loan, your business will need to:

  • Be operating as a for-profit company within the United States or it possessions
  • Have a tangible net worth of less than $15 million
  • Have an average net income of less than $5 million after federal income taxes for the two years preceding the date you apply

In addition, your business will need to follow other general eligibility standards required by the Small Business Administration, this includes:

  • Having qualified management expertise
  • Being of good character
  • Having a feasible business plan
  • As well as the ability to repay the loan including accrued interest

How can an SBA 504 Loan be used?

An SBA 504 loan is available to be used in a variety of business growing activities…

Construction:

  • New facilities
  • Existing buildings or land
  • Long-term machinery and equipment

Improvement or Modernization of:

  • Land, streets, utilities, parking lots, and landscaping
  • Your existing facilities

However, a 504 loan cannot be used for:

  • Working capital or inventory
  • Consolidating, repaying or refinancing debt
  • Speculation or investment in rental real estate

How to apply:

Your business will need to provide important financial documents to apply for the SBA 504 Loan Program [5]. Such documents may include the following:

  • Recording of Ownership Changes
  • Personal Tax Returns from previous three years
  • Personal Financial Statements
  • Business Tax Returns from previous three years
  • Business Financial Statements
  • Transcript Request Form

Though based on your business and its needs, further documents may be needed.

Community First Bank’s experienced business bankers work closely with Certified Development Companies (CDCs) around Washington state to ensure that your business is qualified for a SBA 504 loan and you have all the required documents to successfully apply for the loan.

Contact Us

Reach out to our Business Banking Team to learn about which small business loan is the right choice for your company.

 

(509) 222-2259

Cameron Stephens

Business Banking Team Leader
  • [1] Small Business Administration. https://www.sba.gov/funding-programs/loans/7a-loans.
  • [2] Small Business Administration. https://www.sba.gov/document/support-7a-loan-application-checklist
  • [3] Small Business Administration. https://www.sba.gov/partners/lenders/7a-loan-program/types-7a-loans#section-header-4
  • [4] Small Business Administration. https://www.sba.gov/funding-programs/loans/504-loans
  • [5] Small Business Administration. https://www.sba.gov/sites/default/files/2020-09/SBA%20Form%201244-508.pdf