SBA's 7(a) Loan Program

Don't take our word for it - directly from the SBA:

There are several special purpose programs for extremely specific needs like businesses impacted by NAFTA, export businesses and rural businesses. However, the following is merely basic information regarding their core 7(a) loan program:

The 7(a) Loan Program includes financial help for businesses with special requirements. For example, funds are available for loans to businesses that handle exports to foreign countries, businesses that operate in rural areas, and for other very specific purposes.

7(a) loans may be used to establish a new business or to assist in the acquisition, operation, or expansion of an existing business.

Eligible Use of 7(a) Loan Proceeds Include (Non-Exclusive):

• The purchase land or buildings, to cover new construction as well as expansion or conversion of existing facilities

• The purchase of equipment, machinery, furniture, fixtures, supplies, or materials

• Long-term working capital, including the payment of accounts payable and/or the purchase of inventory

• Short-term working capital needs, including seasonal financing, contract performance, construction financing and export production

• Financing against existing inventory and receivable under special conditions

• The refinancing of existing business indebtedness that is not already structured with reasonable terms and conditions

• To purchase an existing business

SBA loans cannot be used for these purposes:

• To refinance existing debt where the lender is in a position to sustain a loss and SBA would take over that loss through refinancing

• To effect a partial change of business ownership or a change that will not benefit the business

• To permit the reimbursement of funds owed to any owner, including any equity injection or injection of capital for the business's continuance until the loan supported by SBA is disbursed

• To repay delinquent state or federal withholding taxes or other funds that should be held in trust or escrow

• For a non-sound business purpose

Learn More About 7(a) Loans and Other SBA Programs.

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