The Seven Deadly Sins of SBA Loan Applicants

Last Updated on January 14, 2019

There’s seven deadly SBA mistakes that land small business owners in hot water during and after the funding process.

Learn how to avoid them to get the funding you need through a faster, easier and smoother process.

7 deadly sins of sba loans mistakes

The Seven Deadly Sins of SBA Loans

  1. Is your obsession with SBA loans clouding your judgement? Most small business owners immediately pass on hundreds of other financing options, simply because the terms and rates of SBA loans are too desirable to ignore. While they are admittedly great, they should never hold you back from learning what other types of small business loans have to offer. Who knows?You may find that another option has even better terms, rates and amounts that better suit your business needs.
  2. Gluttony When it comes to financing, never bite off more than you can chew. Yet, the intense amount of goals for business growth leads them to think that acquiring vast amounts of SBA funds is the best method for doing so. While growing all at once works for some, this overindulgent spending can be catastrophic for others. Consider whether growing your business in smaller steps would be a better fit for your business, and avoid wasting your business time, money and capital for many years over.
  3. Greed Larger amounts doesn’t always equate to larger growth. When it comes to SBA funding, getting the biggest quantity of capital possible doesn’t always (literally) pay off. Most small business owners aren’t fully aware of the huge commitment that SBA loans present. Lengthy repayment terms can leave your business paying off these vast amounts well into the future, and restrain your business from future growth.Many small businesses with even the most excellent financials simply don’t have the cash flow to support the high amounts owed from SBA funding.So don’t get greedy – know exactly how much you need to accomplish certain goals, restrain yourself from borrowing in excess, and consider other small business loan options to save your business thousands long-term.
  4. Sloth If you aren’t one known for your love of paperwork, sluggish processing, and long periods of waiting around, then the SBA process may not be for you. The SBA loan process is notoriously difficult to navigate. Between endless documents needed, and miles of red tape that leave you hanging for months on end, the pain most endure can be considered nothing short of abuse. So whether you’re a procrastinator, unorganized, or simply aren’t knowledgeable about SBA funding, it’s best to have a competent partner with experience in SBA processing on standby to help.Business Growth Advisors are particularly known for their expertise speeding up and expediting the SBA process by preparing all necessary paperwork for you, and guiding you through the process from application to funding, 24/7.
  5. Wrath Warning: business owners may exhibit anger and destructive behavior towards self and others during the SBA funding process. Although it’s fair to feel this way, it’s one of the worst things you can do for you and your business. Remember: the SBA is a government agency.It’s not your SBA lender or broker’s fault that they can’t qualify you for funding.Standards for approval are determined by the banks they work for, not the lenders themselves.Never let SBA wrath get in the way of your business financing relationships, no matter how enticing it may be.

    Instead of getting mad, get even, and apply for an SBA alternative like the Hybridge™ SBA Loan for an easier approval process, and faster processing.

  6. Envy Don’t covet thy business neighbor’s success in financing. Just because an SBA loan worked for them, doesn’t mean it’ll work the same for you.  And if someone else got SBA approved but you didn’t, just know that: 1) That doesn’t necessarily mean they’re about to grow any faster or more efficiently than you, and 2) You have the opportunity to get a range of funding options that fit your business model just as well (if not better), and can be used just as effectively for successfully growing your business.
  7. Pride Here it is: the deadliest of the deadliest SBA sins. Too many business owners get an SBA loan just because they can, and wind up paying for it dearly in the end. Just because you have the 685+ FICO and $100K annual gross sales needed to qualify, doesn’t necessarily make SBA loans the best option. Finding the perfect financing option for your business takes honest, experienced, and competent guidance and assistance throughout.Every business owner too proud to take the time to explore all other options puts their company at high risk.Find your humble center, and give an expert SBA Advisor a call at (877) 482-3008 for a free consultation.

Is SBA Financing the Best Fit for You?

It wasn’t our complete intention to discourage you from seeking SBA funding.

For many, the prime rates, long terms and large amounts are reason enough to apply.

For others, deciding whether or not SBA financing is the best possible fit for their business is more complicated.

Give us a call for some free expert advice, or apply today to see what options you qualify for by filling out our free 1-minute application online.

National Business Capital & Services is the #1 FinTech marketplace offering small business loans and services. Harnessing the power of smart technology and even smarter people, we’ve streamlined the approval process to secure over $1 billion in financing for small business owners to date.

Our expert Business Financing Advisors work within our 75+ Lender Marketplace in real time to give you easy access to the best low-interest SBA loans, short and long-term loans and business lines of credit, as well as a full suite of revenue-driving business services.

We strengthen local communities one small business loan at a time. For every deal we fund, we donate 10 meals to Feeding America!

About the Author, Megan Capobianco

Megan is passionate about helping business owners along their journey - providing them with relevant content they can use in their day-to-day operations.

Disclaimer: The information and insights in this article are provided for informational purposes only, and do not constitute financial, legal, tax, business or personal advise from National Business Capital & Services and the author. Do no rely on this information as advice and please consult with your financial advisor, accountant and/or attorney before making any decisions. If you rely solely in this information it is at your own risk. The information is true and accurate to the best of our knowledge, but there maybe errors, omissions, or mistakes.