SBA advice and information

Does anyone here have any experience working with SBA loans?

I have a small rental business here in Utah U.S.A. last year’s sales $91,000.

While I do have the collateral to secure the loan, I don’t have a 10-20% down payment that could be required. Credit is ok ….630 due to high utilization of available credit (but always on time with payments)

Is the fact that we showed a loss on our first year taxes (through depreciation and start up costs) going to lessen our chances of being approved? I haven’t done this year’s yet, so I was wondering if it would be in my interest to show a profit?

What info should I know going into the application process?

Any help would be appreciated as the whole process is very overwhelming and the closest SBA counseling facility is 100 miles away.



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  1. You really need to find someone to help you. The SBA had so many products for people who you would think should never get a loan. Most banks have SBA specialists, so I would reach out. It doesn’t have to be in person, just pick up the phone. Good luck.

  2. An SBA loan is a unique product, with a very different criteria than a “regular” loan.

    Depreciation and amortization are “non cash expenses,” so those are added back into the net income to determine the “debt service” (cash available to make the payment)

    Divide the debt service by the loan payment (use an loan calculator to estimate the payment). If the result of that ratio isn’t at least 1.25, you probably won’t get an SBA, or you will be asked to contribute more equity or collateral.

    Never expect to not contribute (have a down payment). If you don’t invest, a banker won’t either. Also, you need to have cash to pay the processing fees, which are often quite high.

    I suggest you bring your financials to a bank and discuss what type of SBA or loan fits you best. Possibly, some other type of financing might work better.

    Hopefully, the information I provided is helpful.

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