Applying for an SBA loan is the perfect option for responsible business owners looking to grow and expand their presence in the local community. Let’s discuss what to expect when applying for an SBA loan, and how to best prepare yourself for the process. 

Since SBA loans are partially funded by the federal government, a lot of detailed paperwork goes into the application process. First, you will need to complete an application checklist consisting of various different documents required by the SBA. Your lender will help you by providing the checklist of the needed information to complete the loan package. Keep in mind that this first step can take up to a month or longer, depending on your level of preparedness, availability of information, and so on. 

Once the loan package is completed, your lender will begin the second step: underwriting. Throughout this stage, you may feel as though you and your business are being micro-examined or scrutinized. Try not to take anything personal, it is simply standard protocol to ensure that the borrower is capable of following through with the loan terms. Again, this can be a lengthy process, taking several more weeks to complete. 

After the underwriting process, the third step is the approval stage. You will receive a loan commitment letter stating the amount of your loan, the duration, and other important terms. If you have any questions regarding the terms and agreements, now is the time to address them with your lender. This step can also take another week or so. 

Finally, the fourth and final step is closing your new SBA loan. Your lender will double and triple check everything for accuracy, and help you to acquire any lingering documentation. You will also receive an official government authorization from the SBA. This final step typically takes a week or two to finish up. 

So throughout the SBA loan process, it’s imperative that you keep your expectations reasonable, and remember that patience is a virtue. The process can take between 60 and 90 days from start to finish, making your wait all the more worth it.