Government SBA loans

SBA loans are funded by approved lenders. The SBA 7(a) program is the most common SBA loan. Funds may be used to:

• Expand or renovate facilities
• Buy machinery, equipment, fixtures, buildings and land for business
• Finance receivables and increase working capital
• Finance seasonal lines of credit
• Construct commercial buildings.

Sometimes the loans can also refinance existing debt. To qualify for a loan you cannot be a non-profit or a business involved in lending, real estate development, investments or speculation, and you cannot exceed the size requirements. These requirements depend on your type of business.

Manufacturing	100 employees
Wholesaling	100 employees
Services and retailing	$6.5 million in receipts
Construction	$31 million in receipts
Agriculture	$750,000 in annual receipts

SBA requirements

• Good character
• Management expertise and commitment to succeed
• Reasonable personal contribution or business equity
• Feasible business plan
• Sufficient collateral (although loans are not declined for insufficient collateral)
• Ability to repay loan from projected operating cash flow

Paperwork required

• Purpose of loan
• Business history
• 3 years of financial statements (if existing business)
• Schedule of debts
• Aging of accounts receivable and payable (if existing business)
• Projected opening-day balance sheet
• Any leases
• Amount of owner investment in business
• Projections of income, expenses and cash flow
• Signed personal financial statements
• Personal resumes
• Personal guarantees from principals owning 20% or more of the business.

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Inventory

Working capital

The loans are issued through non-profits which also provide free technical and management assistance.

The microloan issuers in New Mexico are:

Women's Economic Self Sufficiency Team
414 Silver SW
Albuquerque, NM 87102-3239
www.wesst.org
(505) 241-4766

New Mexico Community Development Loan Fund
PO Box 705
Albuquerque, NM 87103-0705
(505) 243-3196 ext. 18