The Importance of Choosing the Right SBA Lender

Not all lenders are created equal, especially when it comes to SBA loans.

If you’re a business owner exploring SBA financing, you already know that this type of loan can offer competitive rates, long repayment terms, and flexibility that traditional loans may not. But what most borrowers overlook is this: your choice of lender can make or break your SBA loan experience.

Let’s break down why choosing the right SBA lender matters and what sets some lenders apart from the rest.

SBA Preferred Lenders vs. Non-Preferred Lenders

The SBA doesn’t lend money directly to small businesses. Instead, it works with a network of approved lenders. Among these, there are two key categories:

• SBA Preferred Lenders (PLP):

  
  

  These lenders have earned the SBA’s trust and authority to make final credit decisions on SBA loans without waiting for SBA approval. This speeds up the process dramatically and gives borrowers a smoother experience.

  
  

• Non-Preferred Lenders:

  
  

  These lenders must submit each loan package to the SBA for final review and approval. This means longer timelines, more back-and-forth, and potential delays in funding.

  
  

Bottom line? If you want fast, efficient approvals with fewer bureaucratic hoops, working with a Preferred SBA Lender is the way to go.

Collateral Requirements: What You Should Know

Many banks and SBA lenders, especially traditional institutions, require hard collateral to approve your SBA loan. That means putting up real estate, equipment, or other assets as security.

But here’s the thing: We don’t require collateral. We believe in funding based on the strength of your business, and not just your assets. If your cash flow and business model are strong, we’ll work with you to secure the capital you need, without making you risk personal or business property.

This can be a game-changer for service businesses and growing companies that don’t have large assets to pledge.

Final Thoughts

The SBA 7(a) loan is a powerful tool, but only if you’re working with the right lender. A Preferred Lender can get your deal done faster, and a lender that doesn’t require collateral can make funding accessible to more businesses.

At Cornerstone Capital, we’re proud to combine both. We work with Preferred SBA lenders that have a track record of fast approvals and no collateral requirements for qualified businesses.

Need guidance on your options? We’re here to help you grow on your terms.