SBA Loan
Definition
A small-business loan from a bank that is partly guaranteed by the U.S. Small Business Administration, often with longer terms than a regular bank loan. The 7(a) program is the most common.
Want a deeper explanation?
SBA loans can offer longer terms and lower payments than most alternatives, but the application is heavy on documentation: tax returns, financial statements and projections.
Clean, current books speed up approval. Watch for: books and tax returns that do not match, which is one of the most common reasons applications stall.
Example
A brand uses an SBA 7(a) loan to refinance an expensive merchant cash advance into a 10-year loan with a much lower monthly payment.