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Small Business Administration Lending
Southwest Securities, FSB is honored to be designated as a Preferred Lender for
the U.S. Small Business Administration (SBA). This certification allows our SBA Lending Division to approve, process, and fund your loans faster.
We have a dedicated staff of trained professionals to help expedite the SBA loan process for you. Our Business Development Officers have over
100 combined years of SBA knowledge and experience and are committed to
helping you obtain the SBA financing you need to achieve your small business
dream.
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SBA 7(a) Loan Program printable version |
WHAT IS THE 7(a) PROGRAM? |
Financing designed to promote small business formation and growth by guaranteeing long-term loans to qualified firms.
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WHO CAN QUALIFY?
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Most for-profit small businesses in the U.S. are eligible. This includes the following business types: Manufacturers, retail and service businesses, franchises and professional businesses. Size standards are in place. Please call for more detailed information.
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PROJECT AMOUNT
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USE OF PROCEEDS
- Commercial Real Estate (acquisition,construction, refinance, expansion)
- Equipment
- Furniture & Fixtures
- Inventory
- Leasehold Improvements
- Working Capital
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TERMS
- Up to 25 years for Commercial Real Estate
- Up to 10 years for Equipment and Business Acquisitions
- Up to 7 years for Working Capital
- Fully-Amortized over life of loan (no balloon)
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INTEREST RATES
- Variablerate based on a spread over the WSJ prime rate; maximum spread cannot exceed WSJ Prime + 2.75%
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LOAN TO VALUE
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FEES
- One time SBA loan guarantee fee based upon guaranteed amount
- No loan origination fee
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EQUITY INJECTION
- As low as 10% on multi purpose commercial real estate
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OTHER COSTS
- Real estate and equipmentappraisals, environmental reports, businessvaluations, customarylegal and closing costs as applicable
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PREPAYMENT PENALTY (PPP)
- 5% the first year, 3%the second, 1% the third
- Payments up to 25% of the outstanding loan balance will not incur a PPP (on terms of 15 years and greater)
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RECOURSE
- Personal Guarantees required for all individuals owning 20% or more
- Corporate Guarantees may be required for affiliated companies
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BENEFITS FOR BORROWERS
- Finance up to 90% of the project w/commercial real estate
- Low equity contribution (preserves working capital)
- Fully amortizing loans
- Some soft costs may be rolled into the project financing
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OCCUPANCY
- 51% for existing facilities/buildings (renovations and expansions are eligible)
- 60% for Ground-Up Construction Projects (should occupy 80% within 10 years)
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SAMPLE PROJECTS FINANCED BY 7(a)
- Office Buildings
- Medical Clinics
- Franchises
- Restaurants
- Car Wash
- Child/Adult/Pet Daycare
- Dentists
- Printing/Copying
- Suppliers/Wholesalers
- Manufacturers
- Movie Theaters
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SBA 504 Loan Program printable version |
WHAT IS THE 504 PROGRAM? |
Co-Lender financing designed to facilitate the acquisition of capital assets for small businesses
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WHO CAN QUALIFY?
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Most for-profit, owner-occupied small businesses in the U.S. with a net worth less than $15 million and net profit after tax (2 year average) of no more than $5 million; or manufacturer with less than 500 employees.
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PROJECT AMOUNT
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USE OF PROCEEDS
- Commercial real estate (acquisition,construction, refinance, expansion)
- Equipment
- Furniture
- Fixtures
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TERMS
- 1st lien:Up to 25 years for commercial real estate
- 2nd lien: Up to 20 years for commercial real estate
- 1st & 2nd liens: Up to 10 years for equipment
- All loans are fully amortized over the term of the loan
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INTEREST RATES
- SWS, FSB 1st lien: Variable rates
- SBA 504 2nd lien: Fixed rate set by the SBA for the term of the loan
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LOAN TO VALUE
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FEES
- SWS, FSB 1st lien: Set by the lender
- SBA 504 2nd lien: Set by the lender and CDC/SBA
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EQUITY INJECTION
- 10% standard; +5% if special use; +5% if start-up
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OTHER COSTS
- Real estate and equipment appraisals, environmental reports, business valuations, customary legal and closing costs as applicable
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PREPAYMENT PENALTY
- SWS, FSB 1st lien: Set by the lender
- SBA 504 2nd lien: 10 year PPP based on declining balance of debenture rate
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RECOURSE
- Personal guarantees required for all individuals owning 20% or more
- Corporate guarantees may be required for affiliated companies
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BENEFITS FOR BORROWERS
- SWS, FSB will finance up to 50% of the project at a long term, variable rate
- CDC will finance up to 40% of the project at a fixed rate
- Low equity contribution helps preserve working capital
- Some soft costs may be rolled into the project financing
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OCCUPANCY
- 51% for existing facilities/buildings (renovations and expansions are eligible)
- 60% for Ground-Up Construction Projects (should occupy 80% within 10 years)
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SAMPLE PROJECTS FINANCED BY 504
- Office Buildings
- Medical Clinics
- Franchises
- Restaurants
- Car Wash
- Child/Adult/Pet Daycare
- Dentists
- Printing/Copying
- Suppliers/Wholesalers
- Manufacturers
- Movie Theaters
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SBA Loan Comparison Chart printable version
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SBA 7(a) Loan Program |
SBA 504 Loan Program |
| Project Amount |
$250,000 to $5,000,000 |
$500,000 to $6,000,000 |
| Use of Proceeds
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Commercial real estate (acquisition,construction, refinance, expansion),equipment, furniture, fixtures, inventory, leasehold improvements, working capital |
Commercial real estate (acquisition, construction, refinance, expansion),equipment, furniture, fixtures |
| Eligibility |
Net worth below $15 million and average net income for previous 2 years less than $5 million |
Net worth below $15 million and average net income for previous 2 years less than $5 million |
| Terms |
Up to 25 years for commercial real estate
Up to 10 years for equipment and business acquisitions
Up to 7 years for working capital
All loans are fully amortized over the term of the loan |
1st Lien: Up to 25 years for commercial real estate
2nd Lien: Up to 20 years for real estate
1st & 2nd Liens: Up to 10 years for equipment
All loans are fully amortized over the term of the loan |
| Interest Rates |
Variable rate based on a spred over the WSJ prime rate; maximum spread cannot exceed WSJ Prime + 2.75% |
SWS, FSB 1st Lien: Variable rates
SBA 504 2nd Lien: Fixed rate set by the SBA (for the term of the loan) |
| Loan to Value |
Up to 90% |
Up to 90% |
| Fees |
One time SBA loan guarantee fee based upon guaranteed amount. No loan origination fee. |
SWS, FSB 1st Lien: Set by the lender
SBA 504 2nd Lien: Set by the lender and CDC/SBA |
| Equity Injection |
As low as 10% on multi purpose commercial real estate |
10% Standard;
+5% if special use; +5% if start-up |
| Other Costs |
Real estate and equipment appraisals, environmental reports, business valuations, customary legal and closing costs as applicable |
Real estate and equipment appraisals, environmental reports, business valuations, customary legal and closing costs as applicable |
| SBA's Participation |
SBA guarantees loan up to 75% |
CDC/SBA 2nd Lien is direct funding from SBA Debenture guaranteed 100% by SBA |
| Prepayment Penalty (PPP) |
5% the first year, 3% the second, 1% the third.
Payments up to 25% of the outstanding loan balance will not incur a PPP (on terms of 15 years and greater) |
SWS, FSB 1st Lien: Set by the lender
SBA 504 2nd Lien: 10 year PPP based on declining balance of debenture rate |
| Occupancy Requirements |
Borrower to occupy 60% on new construction and 51% on existing property |
Borrower to occupy 60% on new construction and 51% on existing property |
| Job Requirement |
None |
Minimum of one job per $50,000 of debenture (2nd Lien) |
| Recourse |
Personal guarantees required for all individuals owning 20% or more. Corporate guarantees may be required for affiliated companies. |
Personal guarantees required for all individuals owning 20% or more. Corporate guarantees may be required for affiliated companies. |
| Benefits for Borrowers |
- Finance up to 90% of the project for multi purpose commercial real estate
- Low equity contribution helps preserve working capital
- Fully amortizing loans
- Some soft costs may be rolled into the project financing
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- SWS, FSB will finance up to 50% of the project at a long term, variable rate
- CDC will finance up to 40% of the project at a fixed rate
- Low equity contribution helps preserve working capital
- Some soft costs may be rolled into the project financing
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Featured SBA Transactions
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You are leaving Southwest Securities, FSB
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| Continue to www.sba.gov Back to SBA Related Links |
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You are leaving Southwest Securities, FSB
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| Continue to www.sba.gov/sbdc Back to SBA Related Links |
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You are leaving Southwest Securities, FSB
You are leaving www.southwestsecuritiesfsb.com and entering a web site that Southwest Securities, FSB does not monitor or control. Southwest Securities, FSB has provided this link for your convenience. We do not endorse this site and are not responsible for the content, link, privacy policy, or security policy of the web site you are about to visit.
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| Continue to www.borsaplan.com Back to SBA Related Links |
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You are leaving Southwest Securities, FSB
You are leaving www.southwestsecuritiesfsb.com and entering a web site that Southwest Securities, FSB does not monitor or control. Southwest Securities, FSB has provided this link for your convenience. We do not endorse this site and are not responsible for the content, link, privacy policy, or security policy of the web site you are about to visit.
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| Continue to www.business.gov Back to SBA Related Links |
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You are leaving Southwest Securities, FSB
You are leaving www.southwestsecuritiesfsb.com and entering a web site that Southwest Securities, FSB does not monitor or control. Southwest Securities, FSB has provided this link for your convenience. We do not endorse this site and are not responsible for the content, link, privacy policy, or security policy of the web site you are about to visit.
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| Continue to www.nadco.org Back to SBA Related Links |
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You are leaving Southwest Securities, FSB
You are leaving www.southwestsecuritiesfsb.com and entering a web site that Southwest Securities, FSB does not monitor or control. Southwest Securities, FSB has provided this link for your convenience. We do not endorse this site and are not responsible for the content, link, privacy policy, or security policy of the web site you are about to visit.
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| Continue to www.score.org Back to SBA Related Links |
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You are leaving Southwest Securities, FSB
You are leaving www.southwestsecuritiesfsb.com and entering a web site that Southwest Securities, FSB does not monitor or control. Southwest Securities, FSB has provided this link for your convenience. We do not endorse this site and are not responsible for the content, link, privacy policy, or security policy of the web site you are about to visit.
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| Continue to www.frandata.com Back to SBA Related Links |
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You are leaving Southwest Securities, FSB
You are leaving www.southwestsecuritiesfsb.com and entering a web site that Southwest Securities, FSB does not monitor or control. Southwest Securities, FSB has provided this link for your convenience. We do not endorse this site and are not responsible for the content, link, privacy policy, or security policy of the web site you are about to visit.
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| Continue to www.naggl.org Back to SBA Related Links |
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