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Helping People Purchase Their Business with SBA Loan!

Entrepreneur’s are getting their SBA loan closed with Commercial Capital, Ltd. I specialize in financing start up business and start up franchises that have no real estate involved. Many banks do not want to lend to a start up businesses/start up franchises if there is no real estate involved. Well, I am able to lend up to $2MM of goodwill which is unheard of in this market. Lend nationwide.

Types of SBA Loan we offer:

SBA Loan 7(a)

The SBA loan 7(a) loan program is for higher-risk loans; like the acquisition of a business, start-up business, or business that is less than 2 years old.  The loan is used for working capital, equipment, furniture and fixtures, and leasehold improvements or purchase of commercial real estate etc. If the owner is purchasing real estate it is 90% for office, warehouse etc.  If the owner is purchasing special purpose property it can be 85% or less loan to value .  The business piece is 20% injection if the loan amount is below $500,000.00 dollars.  If the business piece above $500,000.00 dollars the injection required is 25%.  SBA 7a is more flexible than the 504 in that it can use projections for income and expenses to Debt Service for the loan. If the total project amount is 51% real estate, then the amortization is 25 years.  If the total project amount has less than 51% real estate, then the amortization is 10 years.  The rate is a variable rate, prime + . The minimum loan amount for my lending sources is $250,000.00 dollars. My 7a loan products have a 3-year prepayment penalty. SBA loan amount is $5MM.

Who can qualify?

Most for-profit small businesses in the U.S. are eligible. This includes the following business types: Manufacturers, retail and service businesses, franchises and professional businesses. Size standards are in place. Please call for more detailed information.

Loan Size
Up to $5,000,000

Use of Proceeds Loans for Small Business

• Commercial Real Estate (acquisition, construction, refinance, expansion)
• Equipment
• Furniture & Fixtures
• Inventory
• Leasehold Improvements
• Working Capital
• Business

Terms Loans for Small Business

• Up to 25 years for Commercial Real Estate
• Up to 10 years for Equipment and Business Acquisitions
• Up to 7 years for Working Capital
• Fully-Amortized over life of loan (no balloon)

Interest Rates

• Variable based on a spread over the WSJ prime rate; maximum spread cannot exceed WSJ Prime + 2.75%

SBA Loan to Value

• Up to 90% for most real estate types
• Up to 80% for business that are $500,000.00 or less
• Up to 75% for the businesses that are more than $500,000.00

SBA Loan Fees

• One time SBA loan guarantee fee based upon guaranteed amount

Equity Injection

• As low as 10% on multi purpose commercial real estate

Other Costs

• Real estate and equipment appraisals, environmental reports, business valuations, customary legal and closing costs as applicable

Prepayment Penalty (PPP)

• 5% the first year, 3%the second, 1% the third
• Payments up to 25% of the outstanding loan balance will not incur a PPP (on terms of 15 years and greater)

Recourse Loans for Small Business

• Personal Guarantees required for all individuals owning 20% or more
• Corporate Guarantees may be required for affiliated companies

Benefits for Borrowers

• Finance up to 90% of the project w/commercial real estate
• Low equity contribution (preserves working capital)
• Fully amortizing loans
• Some soft costs may be rolled into the project financing

Occupancy

• 51% for existing facilities/buildings (renovations and expansions are eligible)
• 60% for Ground-Up Construction Projects (should occupy 80% within 10 years)

Sample projects financed by 7(a)

• Office Buildings
• Medical Clinics
• Franchises
• Restaurants
• Car Wash
• Child/Adult/Pet Daycare
• Dentists
• Printing/Copying
• Suppliers/Wholesalers
• Manufacturers
• Movie Theaters

SBA Loan 504

The SBA Loan 504 loan program is for typically for existing small businesses to finance commercial real estate which can include funiture, fixtures and equipment for use in business operations.  The loan to value aka is 90% on office, warehouse, etc. and on special-purpose like hotel, swim pool it is 85% or less.  The lenders prefer to finance the SBA 504 if the loan amounts typically are a $1MM plus.  504 has better rates which are fixed rates and longer amortizations (20 to 25 years).  The SBA 504 is a conventional first and an SBA second. There are actually 3 loans because there is a debenture loan which is basically a bridge loan made by the Certified Development Company’s.  The 504 has a 10-year prepayment penalty.

Who can qualify?

Most for profit, owner-occupied small businesses in the U.S. with the company’s average net income cannot surpass $2.5 million.

The anticipated project size must be greater than the personal, non-retirement, unencumbered liquid assets of the guarantors/principals.

Net worth of the operating companies must be $7.5 million or less.

SBA Loan Size

• Up to $5,000,000 (1st Lien Maximum)

Use of proceeds SBA Loan for Small Business

• Commercial real estate (acquisition,construction, refinance, expansion)
• Equipment
• Furniture
• Fixtures

Terms

• 1st lien: Up to 25 years for commercial real estate
• 2nd lien: Up to 20 years for commercial real estate
• 1st & 2nd liens: Up to 10 years for equipment
• All loans are fully amortized over the term of the loan

Interest Rates

• 1st lien: Set by Lender
• SBA 504 2nd lien: Fixed-rate set by the SBA for the term of the loan

Loan to Value Loans for SBA Loan Small Business

• Up to 90%

Fees Loans for SBA Loan

• 1st lien: Set by the lender
• SBA 504 2nd lien: Set by the lender and CDC/SBA

Equity Injection

• 10% standard; -5% if special use; -5% if start-up

Other Costs

• Real estate and equipment appraisals, environmental reports, business valuations, customary legal and closing costs as applicable

Prepayment Penalty

• 1st lien: Set by the lender
• SBA 504 2nd lien: 10 year PPP based on declining balance of debenture rate

Recourse Loans for Small Business

• Personal guarantees required for all individuals owning 20% or more
• Corporate guarantees may be required for affiliated companies

Benefits for Borrowers

• Will finance up to 50% of the project at a long term, variable rate
• CDC will finance up to 40% of the project at a fixed rate
• Low equity contribution helps preserve working capital
• Some soft costs may be rolled into the project financing

SBA Loan Occupancy Requirement for Real Estate

• 51% for existing facilities/buildings (renovations and expansions are eligible)
• 60% for Ground-Up Construction Projects (should occupy 80% within 10 years)

Sample projects financed by 504

• Hotels
• Office Buildings
• Medical Clinics
• Franchises
• Restaurants
• Automotive
• Car Wash
• Child/Adult/Pet Daycare
• Dentists
• Printing/Copying
• Suppliers/Wholesalers
• Manufacturers
• Movie Theaters

For quick look to determine if you are eligible for SBA Loan:

• Provide or Complete Personal Financial Statement Click here for form
• Complete 912 form Click here for form
• Complete 4506T form Click here for form
• Business Balance Sheet and Income Statement for most recent year end
• Interim statement
• Business Tax Returns for three years
• Personal Tax Returns for three years
• Provide Credit Report
• Brief Summary
• Example of Summary should include a description of the project. (Include info about borrower, what you need financng for, how much money, how it will be used and specify project cost. Example of project cost is $300K purchase office, $150 refi debt, $30k for marketing and soft cost etc.)
• If purchasing a franchise a FDD which stand for Franchise Disclosure Document and Franchise Agreement
  Color pictures of the commercial building

Paycheck Protection Program & Economic Disaster Loans

If you are a landlord or a business and you have been affected by the Coronavirus Pandemic, the Government is offering a lot of assistance through the SBA.  Here is what to do….

First, apply for the Economic Injury Disaster Loan here….

https://covid19relief.sba.gov/#/

Completing the EIBL Application Your Will Need to Know

You need to know your gross sales and your cost of goods sold for the prior 12 months to January, 2020.  And answer simple questions like address, ownership info, etc.

And some simple questions about your business and some anti-fraud statements.

GRANT

There is a box to check if you want the $10,000 emergency grant, click the box.  It will ask for your business routing number,etc.  If they accept your application, they will wire the $10,000 into your account within 3 days according to the SBA website.  This money will be subtracted from your loan if approved, if not approved, IT DOES NOT HAVE TO BE PAID BACK.  That’s right.  The money will be FREE even if they deny you of the loan.

The whole process should take 15-30 minutes max.  You don’t need to hire anyone, it is very easy.  I don’t know how they calculate how much you will get, but anything helps when you are tight on money right?

Whatever they approve you for will be at a 3.75% interest rate that can’t be beaten for a business loan.

Paycheck Protection Plan

After you applied to the EIDL, you CAN still apply for the Payroll Protection Program as well.  If you are interested in the Paycheck Protection Program, go to your local bank or  click here to start the PPP application.

Commercial Capital LTD Difference

Call Commercial Capital LTD today at  512-358-1511. You may also click here to fill out the form to get started today.