SBA Lending
Through a dedicated team within our Government Lending Division, North State Bank provides guaranteed SBA loans to small businesses in North Carolina and across the nation.
What to Expect
Speed
We have dedicated SBA team with the time, talent and infrastructure to respond quickly. Our loan review and processing takes place under one roof, so there is no downtime due to paperwork being shuffled from location to location.
Simplicity
We have honed our process to be as simple as possible, taking you step-by-step from initial inquiry until closing.
Responsiveness
Our responsiveness is second-to-none. Whether you prefer to stay in touch via phone, email or text, you will find communication to be one of our strengths.
SBA Loans at North State Bank
Commonly Asked Questions
How do SBA loans work?
While the SBA does not make direct loans, it offers programs specifically designed to meet the key financing needs of small businesses through partner banks, such as North State. The SBA sets the loan guidelines, and when a business applies, it is applying for a commercial loan structured according to SBA requirements with a government guaranty.
Who can apply?
SBA loans are available to U.S.-based businesses with tangible net worth of less than $15 million and average net income after federal income tax of less than $5 million over the past two years can apply. Nonprofits are excluded.
Additional parameters include:
- Retail businesses with less than $6 million in annual sales.
- Wholesale businesses with less than 100 employees.
- Manufacturing concerns with less than 500 employees.
What are typical SBA loan requirements?
Liquidity
The ability to cover a 10% equity injection (cash or stock), with funds remaining after the injection.
The ability to cover a 10% equity injection (cash or stock), with funds remaining after the injection.
Industry/Management Experience
Demonstrated industry and management experience sufficient to operate the business successfully.
Personal Real Estate Collateral
Real estate collateral may be needed to address any collateral shortfall.
Real estate collateral may be needed to address any collateral shortfall.
Credit History
A good credit record, free from recent defaults, delinquencies, or bankruptcy filings. The required amount may vary based on project size and other mitigating factors.
A good credit record, free from recent defaults, delinquencies, or bankruptcy filings. The required amount may vary based on project size and other mitigating factors.
For-Profit Business
Non-profit organizations are not eligible
Non-profit organizations are not eligible
What are the advantages of a SBA loan?
SBA loans offer small businesses a variety of advantages over commercial loans:
- Lower equity requirements
- Longer repayment terms
- Fully amortizing loans on 7(a) and 504 second mortgages (504 first mortgages may include a balloon)
- Improved cash flow through reduced monthly payments
- Competitive, market-based interest rates
- Access to capital that may not be available through conventional financing
- Greater underwriting flexibility
- Local bank support backed by a seasoned SBA lending team
What information is needed to apply?
The documents you will need vary depending on the size of your loan request and purpose. A list of typical documents you may need is shown below. In general, larger loans and/or projection-based loans require more documentation.
Personal Information for All Owners/All Applying
- Name and ownership percentage
- Contact details
- Birthdate
- Social Security Number
- Valid Driver’s License or Passport information
- Personal financial information.
- Three years of personal tax returns, including all schedules.
Business Information
- Business name and contact details
- Business type
- Date of inception
- Tax identification (ID) number
- Previous government loan history
- Management team information
- Business plan (if applicable)
- Business financial information
- Business projections
- Formation and other business documentation
- Three years of business tax returns, including all schedules.
What are the steps in the loan process?
Step 1 - Prequalification
Typically completed within 1-3 business days after submission of all required documentation.
Step 2 - Underwriting
Takes approximately 10-15 business days once all necessary documents are submitted.
Step 3 - Closing
Usually occurs within 30-45 business days after closing counsel has submitted and reviewed the documentation. This phase involves coordination with third parties such as accountants (for business valuations), appraisers, title companies, and insurance providers. Response times of third-party partners influence the speed of the closing.