Q: I
am seeking an SBA loan and have been told by business associates to
approach "preferred" SBA lenders only. I thought all SBA
lenders were the same. What's the difference?
A: The
biggest difference is speed. Preferred SBA lenders have garnered
this designation from the SBA by proving they can originate,
underwrite, approve and close a consistent amount of quality SBA
loans. Because of their excellent track record, they're given
full authority by the SBA to approve loans, which allows them to
make decisions usually within a 24-hour period.
Preferred status comes only after the lender proves itself as a
certified SBA lender. Certified lenders have only partial loan
authority and must submit their loans to the SBA for final
approval. With a three-day turnaround for the certified process,
you can see why lenders work so hard to attain preferred status.
That said, a certified lender can still outperform a preferred
lender if it works with an experienced SBA staff.
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The bottom line is to make sure the SBA loan officers at the
lending institution know what they're doing. Ask friends,
business associates and lenders for SBA officers' names and the
dollar amount of loan volume they've generated. And call your
local SBA office for referrals; they know who the real players
are.
SBA loans take many people down the road to business success;
just do your homework to make sure you have an enjoyable trip. To
find your local SBA office, as well as certified and preferred
lenders in your area, visit the SBA Web site at www.sba.gov/financing.
Doug Hood is a co-founder of Rainmaker Capital Corp., a
capital acquisition consulting company in Cartersville, Georgia.
Co-founder Marilea S. Hood contributed to this article. Send
questions or anecdotes via e-mail to doughood@rainmakercapital.com.
Originally published in the January 2001 issue of Entrepreneur Magazine