The lender must meet the general requirements described in part in the guarantee agreement for the guarantee of loans of 7 a). The authorization sets specific requirements for each loan of 7 (a). Lenders must make 7 (a) loans in the same way they make non-SBA loans. Lenders are responsible for properly closing their loans, obtaining and perfecting the necessary deposit positions, guaranteeing guarantees and meeting other authorization requirements. A financial institution wishing to participate in the SBA 7 loan guarantee program (a) must apply for an equity lender through the SBA branch that serves the geographic area in which the lender`s main institution is located. The SBA branch that responds to a request from a financial institution determines whether the lender meets the general requirements of a participating SBA lender. As soon as the SBA branch finds that the lender meets the requirements of a participating lender, the branch and lender sign this form or Form SBA 750B, Loan Guarantee Contract (Deferred Participation) for short-term loans (loans of 12 months or less). Once this form is completed, the SBA branch adds the lender to the SBA Partner Information Management System (PIMS) which identifies the lender as the participating lender. A loan of 7 (a) can be used for a variety of commercial purposes, including real estate or equipment purchases, working capital or inventory and expansion. The money can be repaid over 10 years for working capital and 25 years for real estate. Interest rates do not exceed 2.75% if spread over seven years. There are many subcategory of 7 (a) loans that are worth considering. Talk to your local loan manager or visit the SBA website (see link below) to learn more about the Small/Rural Lender Advantage program, the Express Community Loan Program, Patriot Express, Export Express and Gulf Opportunity loan programs.
In granting the authorization, the SBA relies on elements of the loan application and supporting documentation. The SBA 750 agreement requires the lender to do so: most lenders are familiar with SBA lending programs, so entrepreneurs and other interested applicants should contact their local lender for more information and support as part of the SBA lending process. Form SBA 750, the lender`s Deferred Participation contract, is used for the same purpose, but for loans lasting more than 12 months. (a) a lender may sell, with the prior written agreement of the SBA, all of its shares in a loan to another lender operating under a credit guarantee agreement (SBA 750) (“participating lender”), which SBA may retain at its sole discretion. A lender cannot sell its shares in a 7a loan to a non-participating lender. The purchase lender must take possession of the change of funds and other loan documents and serve the 7a loan sold. The acquiring lender acquires the loan subject to SBA`s existing rights, including its right to deny liability for its guarantee in accordance with the provisions of p. 120.524. After the purchase, the acquired loan is subject to the credit guarantee contract of the acquiring lender. This paragraph (a) applies to all 7 (a) credits acquired by a federal or national banking supervisory authority, beneficiary or conservative, unless the SBA otherwise accepts them in writing. This paragraph (a) applies to all 7 (a) credits acquired by a federal or national banking supervisory authority, beneficiary or conservative, unless the SBA otherwise accepts them in writing.