As a small business owner, one of the worst things that you have to do is wait. Nobody likes waiting, but when you are waiting on news that could completely change your business, it is even worse. That is why waiting to hear if your SBA 7(a) loan has been approved is almost like torture.
When anybody applies for a loan, one of the first questions out of their lips is “how long will it take?”. If you are applying for external funding, then there might be a sense of urgency to it, or you might simply be eager to get that money in your bank account so that you can get started.
SBA 7(a) loans are so popular because they have a “quick” approval time. But, just how quick is this approval time? Let’s take a look.
What is the SBA 7(a) Loan?
When it comes to business loans, the SBA 7(a) is undoubtedly one of the most popular. In fact, when small businesses consider taking out a business loan, the SBA 7(a) is often their first choice. It is the most popular loan that the SBA offers, and it is usually a safe bet if you are a small business in need of money.
The SBA 7(a) loan is guaranteed by the U.S. Small Business Administration, which is a group that was established by the U.S. Government in the 1950s. The Small Business Administration was set up with one sole purpose, and that was to support small businesses. This is why so many small businesses feel like they can rely on the SBA.
All the SBA loans come with different eligibility criteria, but the SBA 7(a) loan has the broadest criteria. This is another reason why it is so popular.
This eligibility criteria will include things such as: being a business with less than 500 employees and being registered as a for-profit business. But remember, this is just a handful of the criteria that you will have to fit into in order to qualify for this type of loan.
How does the Application Process work?
Before we take a look at how long it takes for your SBA loan to be approved, let’s first take a look at the application process. Understanding this will help you appreciate why the approval process takes the length of time that it does.
As we have said, the Small Business Administration has been offering loans to small businesses since the early 1950s. It was set up to aid entrepreneurs and small businesses that have been unsuccessful in other financing options, and it does this time and time again.
The SBA 7(a) loan scheme is guaranteed by the SBA, but it is actually offered by most high street banks. These banks offer the money in the loan, and it is guaranteed by the government.
If a small business were to default on their loan payments, then this is when the SBA would step in, to guarantee that the bank does not lose the money they lent to that company.
How long does it take to approve an SBA 7(a) Loan?
If you have applied, or have considered applying for an SBA 7(a) loan, then you are probably wondering how long it will take for that money to enter your bank account.
An SBA loan of any kind can be a real lifesaver for a business. It can help pay off bills and allow you to expand the business, so it is understandable that you will be eager to get your hands on that money.
Generally speaking, the SBA 7(a) loan has one of the fastest approval periods, and you will actually be able to get your hands on that money pretty quickly. So, with that in mind, let’s take a look at exactly just how long it takes for an SBA 7(a) loan to be approved.
Once you submit your application for an SBA 7(a) loan, you will likely be eagerly awaiting confirmation that you have been approved. Sadly, it is impossible for us to give an exact amount of time that it will take for your application to be approved, simply because it depends on the specific lender.
The SBA 7(a) loan is guaranteed by the SBA, but it is actually offered by various different banks and lenders. Some lenders will be very experienced with offering this loan, but others will not. Generally speaking, lenders with lots of experience of dealing with the SBA loan system will have a quicker approval time than those who lack experience.
So, if you want your loan to be accepted quicker, it is best to vet potential lenders first. This way, you will be able to find a lender that has lots of experience with these loans, and this will allow you to be approved much quicker.
After you have had notification that your application has been accepted, you will be even more desperate to get your hands on that money. Being approved allows you to breathe a real sigh of relief, but this doesn’t mean that the money will enter your account immediately.
There are a lot of processes that loans must go through before they can be given to the applicant. All lenders will have different procedures, and this could cause your money to take longer to reach you. But generally speaking, it will take between 7 and 10 days for the money to enter your account once you have been approved.
After the lender approves you, they will send your information onto the SBA. The SBA will then review your information, and confirm the decision made by the lender. Once the SBA has confirmed the loan, your money will begin processing and will be with you within 10 days.
In short, the amount of time that it will take for your SBA 7(a) loan to be approved will depend heavily on the lender that you have applied with. But, once your application has been approved, you should expect to receive your money within 7-10 working days.