Unlocking Loan Success: Five Habits Every SBA Borrower Should Embrace
Getting an SBA loan can be a crucial step in growing or starting your business. The process can be intimidating at the start, but if you embrace the habits below, you will ensure a smooth borrowing experience and increase your odds of getting to the closing table:
1. Stay Engaged with the Process and Respond Promptly to Lender Requests:
Throughout the SBA loan application process, it's essential to stay actively engaged. Once you have received a financing offer from your lender, you are in the driver’s seat and will determine how the pace of your loan request moves. Keep the lines of communication open and be proactive in providing any necessary details. By staying engaged and being responsive, you not only expedite the loan approval process but also show lenders that you are committed and reliable. This level of engagement goes far in developing a strong overall borrower-lender relationship.
2. Clearly Define Your Request
Before approaching a lender, have a clearly defined request for the loan amount and purpose of those funds. Lenders appreciate borrowers who can clearly and directly articulate their needs and intentions. Always keep in mind, that your request should focus on how these funds will help grow your business. Outline a detailed plan that clearly shows how you plan to use the loan. By having a well-thought-out request, you not only demonstrate financial responsibility but also make it easier for lenders to understand and support your loan application.
3. Save for a Down Payment and Understand Your Post-Closing Liquidity:
Saving for a down payment not only reduces the amount you need to borrow but also shows lenders that you have financial stability. Start early and set aside a portion of your income for your down payment fund. Additionally, it's essential to understand your post-closing liquidity, which refers to the amount of cash and easily convertible assets you'll have after the loan is finalized. Demonstrating both a down payment and awareness of post-closing liquidity enhances your financial credibility with lenders.
4. Stay Organized Throughout the Loan Process:
Maintain a high level of organization as you navigate the loan application process. Keep track of your financial documents, including income statements, tax returns, and credit reports. It helps to keep a folder on your desktop where you keep copies of all items that have been requested of you. This not only expedites the application process but also gives lenders confidence in your preparedness. Staying organized ensures you can provide necessary information promptly and make the loan application journey faster and smoother.
5. Build a Strong Relationship with Your Lender:
Building a positive relationship with your lender can go a long way in ensuring a smooth and easy process. Communicate openly, be responsive to requests for information, and keep them informed about any changes in your financial situation.
Successfully securing a loan is about more than just numbers—it's about demonstrating responsible financial habits and building a relationship with your lender. Happy borrowing!
About the author
Mary Hayes is a dedicated and thorough SBA financing professional. She provides white glove service to each and every one of her clients. She mastered in tailor financing solutions to meet each client’s unique needs. To learn more about SBA financing options, our referral program, or to join the VelocitySBA team, reach out to Mary at mhayes@velocitysba.com or 954-868-0033.