Got your attention didn’t it! Ads for small business loans litter the internet. As a small business owner myself, I receive at least 5 pieces of junk mail offering small business loans weekly. Some small business lenders have become the new credit card company – Bad Credit, No Credit, No Problem! The access to small business loans is easier, and scarier, than ever before. Too many times I have seen business debt schedules of borrowers who obtained one of these loans that equated to a 94% APR or higher. Additionally, there is no monetary benefit to a pre-payment because the terms were based on a set payment for a set period of time.
Other debt incurred by small business borrowers can stifle small businesses growth. Small business owners don’t have the time to apply for a new loan or renewal every few years. The SBA product offers reasonable rates and fully amortizing loans. The SBA has extensive requirements when it comes to refinancing debt, but the basic rules are as follows:
The loan being refinanced needs to have been eligible originally
The current debt cannot already be on reasonable terms
The new installment amount must be at least 10 percent less than the existing installment amount
This product can become a significant arrow in the quiver of a community lender and make you a hero to you customer.
Want to learn more about SBA Debt Refinancing? Join us at 1 PM EST on Wednesday, March 11th for our RLS Interactive Training on SBA Debt Refinancing.