SBA 7A - what defines a great deal today?

searcher profile

November 19, 2023

by a searcher from University of Houston, Downtown in Houston, TX, USA

Hi all,

I am in the middle of my first time acquisition. Shopping for a loan with three different banks. Just got my first proposal in.

Please share thoughts on what are the current benchmark and what makes a good from a bad deal based on todays rates.

Proposal:

3 year fixed rate at Prime + 1.50% and prime + 2.25% floating rate for the remaining 7 years.


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commentor profile
Reply by an intermediary
from Indiana University at Bloomington in Carmel, IN, USA
Most deals are floating with today's high interest rates. Will probably go down but how much is the unanswerable question. I have recently completed one at 1% over prime (excellent small strategic buyer) to the maximum of 2.75% over.
Some bankers are trying to hit their numbers for the year right now as well, but too late to close by###-###-#### Bankers do consider equity, assets and experience into the rate. But your first quote is not bad.
commentor profile
Reply by a lender
from Eastern Illinois University in 900 E Diehl Rd, Naperville, IL 60563, USA
If you are purely looking from a real estate perspective, that is a very fair rate. However, what makes a good deal also has to do with how the equity and debt stack is being required to be structured and being sure you get from term sheet to approval. But again, from an interest rate perspective, that is a very solid rate offer.
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