SBA Loan Program - Business Loan and Commercial Mortgage Issues

The most problematic commercial mortgage business loan scenarios for many commercial borrowers will be the refinancing of a Small Business Administration loan (SBA loan) or getting the initial SBA loan. Both of these SBA loan problems require a prudent business financing approach, but there are reasonable solutions.

Is an SBA Loan and Business Loan Program Too Complicated?

The prevailing wisdom about buying a business with an SBA loan can be summarized as follows: (1) Commercial borrowers would be wise to avoid an SBA loan. (2) Commercial borrowers would be wise to use an SBA loan. These opposite perspectives are due to a confusing SBA business financing process that is perceived by some business borrowers as too complex.

In reality SBA loan programs are more practical than they often appear. It is critical to the success of an SBA loan program to be working with an SBA loan advisor and lender that is proficient at this difficult commercial mortgage process. There are many potential business loan problems to avoid when attempting to obtain an SBA loan, and very few lenders are skilled in this business financing area.

Can an SBA Loan Be Refinanced?

SBA Loan refinancing has usually been a very difficult proposition. New business loan programs have dramatically improved these SBA commercial mortgage refinancing restrictions, but the new SBA refinancing options are not widely available.

Advance commercial mortgage planning can avoid some of the SBA loan refinancing problems. First and foremost, if the original business financing is arranged without an SBA loan, this will make later business refinancing easier than if an SBA loan is involved. This means that commercial borrowers should at least consider if the initial business loan requires an SBA loan before proceeding.

SBA Loan Misunderstandings - The SBA Business Loan Process

One of the prevailing views of an SBA loan program concerns the documentation needed to finish the commercial mortgage requirements. The key to a successful SBA loan process is trusting the SBA loan facilitator about what is required. What business borrowers should try to realize before becoming frustrated by the SBA loan process is that any commercial loan process will include substantial paperwork whether an SBA loan is involved or not.

A more serious possibility for business borrowers is that they could end up with an SBA lender that is rarely successful in finalizing SBA loan applications. Judging the SBA loan process by looking at the frequency of both successful and timely outcomes for commercial borrowers, the harsh reality is that there appear to be far more ineffective SBA lenders than effective SBA lenders on a nationwide basis.

Alternatives to SBA Loan Financing - Conventional Business Loan Options

The practicality of refinancing a commercial loan will be determined by the commercial borrower decisions when acquiring the original business financing. In obtaining a commercial loan to buy a business, non-SBA business loan possibilities should be evaluated along with the option of obtaining an SBA loan.

Refinancing an SBA loan or conventional business loan will usually be more effective when using an experienced and successful SBA loan - business financing advisor and lender. Commercial borrowers should not overlook the feasibility of traditional commercial mortgage options.

Copyright 1995-2007 AEX Commercial Financing Group and Stephen Bush. All Rights Reserved.

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Stephen Bush and AEX Commercial Financing publish the Business Cash Advance Guide and free Commercial Mortgage Reports

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