Every seasoned entrepreneur and small business owner understands that access to working capital and the financial agility that comes with it are the lifeblood of growth and staying competitive over time. Small Business Administration (SBA) loans for many companies form the backbone of this liquidity.
In the simplest terms, SBA lending programs provide loans guaranteed by the SBA ranging from $500 to $5M that can be used for most business purposes, including long-term fixed assets and operating capital. The SBA does not lend money directly to small business owners. Instead, it sets guidelines for guaranteed loans made through its lending partners like First American Bank, making it easier for small businesses to access capital
Compared with traditional loan products, SBA-guaranteed loan programs offer growing companies specific benefits that can accelerate expansion, reduce borrowing costs, and help businesses navigate uncertain economic conditions, including the current economic contraction caused by the COVID-19 pandemic. These benefits include more competitive rates and fees compared to non-guaranteed loans, lower down payments with minimal or no collateral, and flexible overhead and loan maintenance requirements.
At First American Bank, we believe the SBA’s loan programs and products are critical pillars of the U.S. economy—and see our expertise and experience in them as one of the core foundations of our long-term customer relationships.
SBA-guaranteed loans provide unprecedented flexibility and capital support for growing businesses. Being one of only 20 banks in the country that has delegated authority under all of the SBA guaranteed programs puts us in the unique position to help educate borrowers on the various uses of the SBA’s programs while also working with the SBA directly to help improve their programs in response to the fast-changing needs of dynamic growing businesses.
This “upstream,” experience-based, advisory approach with both borrowers and the SBA can make a critical difference in how growing companies utilize their working capital, manage cash flow, and take advantage of new opportunities. Many lenders take a standardized approach to SBA lending and often turn their loans around and sell them for a premium. We, however, work with each borrower individually to understand their unique needs and customize every SBA loan product to maximize its potential for growth while minimizing the financial risks for our clients.
Our approach is very different from most other lenders. Our SBA team works alongside each loan officer and considers each of our customers’ individual needs to make the best determination for which SBA program will be a proper fit. What separates us from other lending institutions is that we work with all of the SBA’s programs instead of utilizing a one-size-fits-all approach to maximize possibilities for our clientele.
First American Bank’s status as one of only 20 SBA Preferred Lending Partners (PLP) nationwide whose internal monitoring procedures meet all of the SBA’s guidelines also puts us in the unique position to apply for loans quickly with a greater certainty of approval, specifically with loans that fall under the SBA’s Export Working Capital Program (EWCP). For the expanding manufacturing companies and exporters, this Preferred status and our tenured experience with SBA loans can mean the difference between seizing an opportunity or letting it pass them by.
Our SBA team is involved at all levels of SBA loan programs inside and out, epitomizing our level of expertise. We are a regular presence at the annual NAGGL (National Association for Government Guaranteed Lenders) presentation, which is the major SBA trade association, and are often asked to explain the SBA’s export programs to other lenders to demonstrate how these programs can be leveraged. This creates interest in SBA’s export programs generally across the country, while also giving small businesses the intelligence and resources they need to borrow smartly. We also speak to many Chambers of Commerce, and various SBA Export Lender roundtables to help business owners understand the variety of SBA programs available to them. If experience is the difference in choosing a lending partner, our expertise in SBA loan programs is why so many growing businesses choose to do business with us.
For more information on First American's SBA loan programs or to speak with one of our experienced lending experts, contact us here.
