As a growing small business in New York, you need a financial institution that stands behind you. Whether you are looking for funds to buy machinery or equipment, recover from a disaster, or expand your business, there may be an option for you through SBA-preferred or approved lenders like Customers Bank. We are proud to be an SBA Preferred Lender.

Who Offers SBA Loans?

The Small Business Administration does not make loans directly to businesses. Instead, the agency sets guidelines and partners with banks, credit unions, and alternative lenders to provide loans to small business owners on its behalf.

SBA Loan Programs Made Easy

As a potential borrower, you should get familiar with SBA loan programs so you can apply for the right one for your small business.

Because the federal government guarantees SBA loans, lenders are more willing to offer financing to small businesses through these loans. Lenders typically lower their qualifications for small business applicants.

SBA 7 (a) loan program – This program is designed to help startups and existing small businesses that need financing. SBA 7(a) loans can be utilized for nearly any business need, including:

• Establishing or acquiring a business
• Short- and long-term working capital
• Equipment purchases
• Fixtures, furniture, and supplies
• Large inventory purchases
• Commercial real estate
• Renovating an existing building
• Refinancing existing business debt (under certain conditions)

Other factors/requirements:

• Maximum loan amount of $5 million
• Must operate for profit
• Be engaged in business in the United States or its possessions
• Have invested equity

CDC/SBA 504 loan program – This SBA loan program offers financing for significant fixed assets for small and mid-sized businesses that will be the primary occupants of the property financed. It provides funding for things like:

• Purchase of commercial real estate or land
• Purchase or construction of existing or new facilities
• Equipment and machinery
• Improvements of land, streets, utilities, parking lots, and landscaping
• Renovating existing business facilities

CDC/SBA 504 loans CANNOT be used for:

• Working capital or inventory
• Consolidating, repaying, or refinancing existing debt
• Investment in rental real estate

Other factors/requirements:

• Maximum loan amount of $5 million
• Long-term, fixed-rate loans
• Must be a for-profit company in the United States or its possessions
• Must have a net worth of less than $15 million
• Must have an average net income of less than $5 million
• Two lenders are paired to fund the project: a bank or traditional lender and a community development corporation (CDC).
• Must occupy at least 51% of the commercial space

Microloan program – The SBA microloan program gives small loans to business startups and newly established or growing businesses. Microloans come in handy for the purchase of:

• Working capital or inventory
• Furniture, fixtures, and supplies
• Machinery and equipment

Microloans CANNOT be used for:

• Paying existing debts
• Purchasing real estate

Other factors/requirements:

• Maximum loan amount of $50,000

The Bottom Line

SBA loans are among the best financing options for small New York businesses, offering advantages like lower down payments, low-interest rates, and longer repayment terms. SBA-approved lenders like Customers Bank will walk you through the different loan options and recommend the financial vehicle that makes the most sense for your unique situation.