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Small Business Administration (SBA) Loans for Women

There are a number of options available to women for obtaining

small business loans. One of the most well-known types of

business loans available for women is through the Small Business

Administration (SBA).

The Small Business Administration does not lend money directly

to women, corporations, partnerships, or other individuals, but

rather, Small Business Administration loans for women can simply

guarantee loans that have been submitted by financial

institutions. In other words, a woman interested in a business

loan can be obtain a loan easier if the loan is approved and

guaranteed by the Small Business Administration. Small Business

Administration Loans for women are applied for just as with a

regular small business loan, namely, through a commercial bank,

or another local, regional, or national bank.

Guaranteed approval for Small Business Administration loans for

women offers women the opportunity to obtain monies without the

hassle or stress involved with wondering whether or not the loan

will be approved. To come to a decision on a loan request with

the Small Business Administration, the SBA evaluates a business

or potential business idea much the same as any other lender.

Small Business Administration loans for women, however,

guarantee a financial institution that the loan will indeed be

paid. The SBA is of huge assistance to small businesses owned by

women, especially if a financial institution will not approve a

business loan. Reasons that a financial institution may not

approve a loan may including the following:

- The borrower has insufficient collateral. - The particular

area of business or industry is a high risk to the financial

institution. - The business is older and requires much updating

to succeed.

In these instances, Small Business Administration loans for

women can come into play, and can assist a woman in obtaining a

loan for business purposes. With guaranteed Small Business

Administration loans for women, the SBA is guaranteeing the

financial institution, or the lender, that 80 percent of a loan

value up to $100,000 will be paid back in the event of default,

and 75 percent will be paid to the lender on loans over $100,000

that default, with a maximum loan value guarantee of $750,000.

Small Business Administration loans for women offer lenders the

security and guarantee that a business loan will be paid back to

the financial institution lending the money if the money is not

paid back by the borrower. Small Business Administration loans

for women are, therefore, a hugely powerful lending tool for

women in business, including those women just entering the

business world by starting a new business, as well as women

purchasing an existing business, or purchasing new equipment or

supplies in an existing business that they currently own but

would like to expand upon in one or more ways. Women who may not

otherwise qualify for a business loan through a bank or other

financial institution can turn to Small Business Administration

loans for women for assistance.

It is important to keep in mind that Small Business

Administration loans for women are not necessarily inexpensive

loans. Interest rates tend to be at, or above, typical interest

rates for commercial loans offered by other financial

institutions and banks. In addition to this, there is a guaranty

fee, typically 3 percent to 3.875 percent, based on the dollar

amount of the guaranteed portion of the loan. Small Business

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Administration loans for women also offer a longer amortization

rate than most commercial loans offered through banks and

financial institutions. Working capital loans can be financed

for up to seven years. Fixed asset loans can be financed for up

to ten years, and real estate or construction of a building for

business can be financed for up to 25 years.

Before applying for Small Business Administration loans for

women, it's crucial that all "homework" is done. Check your

credit scores. If there are marks on your credit report, work to

resolve them. Prepare to explain anything that cannot be cleared

up, and be honest. Create have a written summary of your

business, as well as a summary listing everything that will be

purchased should the loan be approved. If the business is

already in existence, be prepared to show reports, bank

statements, and receipts to verify that the loan payments can be

made each month.

For more information on what the Small Business Administration

offers in your area, visit

http://www.sba.gov/regions/states.html, and click on the state

in which you reside or will operate your business. Information

available includes financing information, disaster relief

information, counseling and training resource, opportunities, a

start-up kit, local resources, and other extremely valuable

tools for business.

About the author:

Rebecca Game is the founder of Digital Women ®, an online

community for women in business. A 30 year entrepreneur and

dedicated to helping other women. Visit her site: Loans for

Women

http://loans.digital-women.com