SBA Loan Firm is our Subject to Investigate

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SBA Loan Firm is our Subject to Investigate.
David Turkin OK Today. The validity of SBA loans
an article for our LA-Times 1998- recap 11-24
Business Challenge about SBA-loans November 1999
After months of review and investigation David
Turkin Talks SBA 7-a loans which were developed
to provide small businesses a government backed
guarantee so that businesses could obtain loans
for a broad scope of business purposes. These
loans were designed for both new businesses and
established businesses. It is easier for
established businesses to obtain loans because
they are usually less risk and have a proven
track record. One of the misconceptions is that
the SBA does not issue loans but provides a
guarantee to the lending bank. The fees incurred
related to SBA loans include two points closing
costs plus other costs that could incur such as
accountant costs, business planning costs, loan
packaging fees appraisals or evaluations as well
as other miscellaneous fees that are charged
prior to loan acceptance. As a borrower you
should be aware that the SBA is going to add
restrictions to the loan which include personal
guarantees, collateral, and ability to
future borrowings or indebtedness. The time
period for approval can be lengthy since your
request has to be approved by the bank or lender
as well as the SBA. Like any loan request, past
credit history (usually FICA Score of 700), past
performance of debt coverage of at least 1.2
times. If you are acquiring a business or
starting a business the rule of thumb is
a minimum capital injection of 30-35 of the loan
amount. Any person that has more than 20
equity in the business must be disclosed
and will have to provide financial
information, collateral and guarantee the loan.
If the business defaults the bank and SBA will go
after the collateral. I do not recommend SBA
guaranteed loans to my clients specifically
because of the restrictions involved, the
necessary collateral requirements, costs
involved, covenants and restrictions on both the
business and personally. The process can take
months and months and months for the approval and
funding. Business owners and business people
are looking for results, they may not need
immediate results but still waiting in excess of
30 days is the kiss of death to many fast moving
deals. Conventional and unconventional loans for
most business people have a timeline attached to
them. Our clients come to us with specific goals
and outcomes and asking them to wait weeks can be
a challenge so asking them to wait months is near
impossible. Our resource library for lending
institutions is large and we can in most cases
give our clients a realistic funding date and if
that date is not met it is usually something our
client is missing at the moment and not the
institution.
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We assist all our clients with either preparing
their loan package for their bank or preparing
their loan package and presenting it to our
lenders. We get the job done, call us if you are
seeking funds to purchase a business, expand your
current business, build your inventory or update
your equipment. We can secure realistic funding
for most all your business needs and we are
always accessible. Call David Turkin 800 490-8362