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Small Business and SBA Lending Blog
Last updated on Feb 19, 2023
1 min read

What Is an SBA Preferred Lender?

An SBA Preferred Lender can help borrowers get the funds they need faster than a regular SBA lender. When a bank or financial institution has a "Preferred Lender" status, this institution has the authority to make final credit decisions on SBA-guaranteed loans.

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An SBA Preferred Lender can help borrowers get the funds they need faster than a regular SBA lender. When a bank or financial institution has a "Preferred Lender" status, this institution has the authority to make final credit decisions on SBA-guaranteed loans. By contrast, non-preferred lenders must submit the loans directly to the SBA for approval, which makes the process longer.

To learn more about the SBA 7(a) loan program or to get a free quote, simply fill out the form below!

Related Questions

What are the benefits of working with an SBA Preferred Lender?

The benefits of working with an SBA Preferred Lender include expedited loan approval and improved chances of loan approval. Preferred lenders have the authority to make decisions on behalf of the SBA, and they have proven track records of getting small business owners the funds they need in a timely manner.

For more information, please visit this page.

What qualifications must a lender meet to become an SBA Preferred Lender?

To become an SBA Preferred Lender, credit unions, savings and loan institutions and banks must have a firmly established history of making and servicing guaranteed loans. The SBA will review the lender’s portfolio every two years and conduct its own checks. Source 1 and Source 2.

How does an SBA Preferred Lender differ from a traditional lender?

An SBA Preferred Lender is a lender that has been approved by the Small Business Administration to make loan decisions without approval from the SBA. This allows for a much faster loan approval process, with many potential borrowers being approved in as little as 24 hours. In contrast, traditional lenders must submit a full application to the SBA, which can take up to three business days for approval.

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What types of loans can an SBA Preferred Lender provide?

An SBA Preferred Lender can provide SBA 7(a) loans. These loans are typically used for working capital, equipment, and real estate purchases. The SBA 7(a) loan program is the most popular loan program offered by the Small Business Administration. It provides up to $5 million in financing and has a maximum repayment term of 25 years. The interest rate is based on the prime rate plus a margin, and the fees are typically 3-4%.

For more information, please visit SBA 7(a) Loan Amounts, Maturity, and Rates.

What are the advantages of obtaining an SBA loan through an SBA Preferred Lender?

The advantages of obtaining an SBA loan through an SBA Preferred Lender include faster loan processing times and improved chances of approval. Preferred lenders have the authority to make decisions on behalf of the SBA, and can often approve loans in as little as 24 hours. Additionally, Preferred Lenders have a proven track record of getting small business owners the funds they need in a timely manner.

For more information, please see the following sources:

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