By Brandon Stevenson, Sr. SBA Loan Servicer, Core Bank.
Until I began my career in banking, the SBA is not something I’d ever heard of. You would think after years in mortgage and banking that something would have come up about SBA lending at least once. When I was first exposed to this method of lending, I had questions, and like a caffeinated two year old, I began asking a lot of them.
The most difficult thing for me to understand about SBA lending was why I hadn’t heard of this before. Government secured loan programs for small business owners. Small business owners who need that little push to get their businesses off the ground. This sounds like something that should be common knowledge.
A week before writing this story, I heard on a well-known investment show that an entrepreneur had initially taken on an SBA loan… and there wasn’t another word spoken about it.
What is an SBA Loan?
Here is the formal description from the Small Business Administration website: The SBA works with lenders to provide loans to small businesses. The agency doesn’t lend money directly to small business owners. Instead, it sets guidelines for loans made by its partnering lenders, community development organizations, and micro-lending institutions. The SBA reduces risk for lenders and makes it easier for them to access capital. That makes it easier for small businesses to get loans.
That seems fairly straight forward. The SBA lending program is designed to serve a need as opposed to signing people up for debt that they don’t need. And we’re the financial bridge between the SBA and the borrower.
Aside from the SBA sticker on the door, you would never know a bank did these kind of loans. Not to mention you would never hear how many businesses in our local area actually received their initial funding from an SBA loan. And then I realized the best way to educate the business community on SBA lending would be to tell stories about our clients, and show the positive impacts of SBA lending.
Our story is about helping people realize their dreams of owning and operating a successful small business, and we’re proud to be the largest SBA lender in Kansas City. *
* Based on annual volume.