SBA rates

June 05, 2024

by a searcher from Palm Beach Atlantic University in Fort Lauderdale, FL, USA

What are some of the best rates you are seeing right now?

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Reply by a lender
in United States

There's a lot to unpack here. There's no such thing as quoting a "best rate" for an SBA-backed small business acquisition. Buying a small business with SBA financing isn't like shopping for a home mortgage rate. Many variables impact the SBA-backed loan interest rate, including lender policies (bank or non-bank), collateral, the uncollateralized portion, historical cash flow of the business, the strength of personal guarantors, the down payment, the equity in individual real estate pledged (if applicable), and the risk or strength of the industry. I recently attended a webinar in which aspiring small business buyers were told that personal credit scores don't matter for SBA-backed loans. The speaker claimed credit decisions were based solely on the seller's merits, which is wrong advice. There's a lot of information out there, but much of it is inaccurate, causing confusion. Lender credit policies and interest rates vary greatly, especially between middle-market M&A deals and small business deals, which are very different. Buying a small business isn’t about finding the best rate—it's about finding the best fit for your unique business acquisition situation. Trust experience over generic advice. Thanks for the heads-up tag ^redacted‌

Reply by an intermediary
from Creighton University in Los Angeles, CA, USA

We've been seeing on average prime + 2% or 10.5%. The lowest term sheet we've seen was 7.45% last week.

For context, I co-founded Dealwise to get borrowers the best interest rates for an SBA loan after I realized I couldn't rely on loan brokers or the SBA lender match. We're a marketplace connecting searchers to lenders. Unlike other online marketplaces, we display bank interest rates from over 2,000 lenders so you can find and choose the lowest ones. We've helped dozens of searchers like yourself get the lowest interest rate SBA loans. You can check us out here [https://godealwise.com/]

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