Have you ever wondered about Small Business Administration (SBA) loans, and whether their favorable terms can help your business flourish? Whether your company is a start-up or has been in business for a number of years, an SBA loan may be just the tool you need to grow and thrive. Megan Comfort, SVP/Small Business Manager at Nevada State Bank, provides some guidance on accessing and qualifying for these loans.

“I work with my team and our clients to get financing for Nevada small businesses,” she explained. “One of our financial sources is the SBA. We help with educating small businesses by explaining the process and how the business can benefit from and utilize these loans to achieve their financing goals.”

“Small businesses should always partner with a bank when seeking an SBA loan,” she advised. “Bankers know how to structure, educate clients on the best program, and package a loan to get SBA financing (1), and Nevada State Bank is one of the top banks for SBA loans in Nevada.”

NSB has been designated an SBA Preferred Lender, having demonstrated proficiency in processing and servicing loans guaranteed by the federal agency. The SBA Nevada District office named NSB as a top lender in May 2023 for fiscal year 2022. NSB received: SBA Nevada Regional Lender of the Year (second place) and SBA Nevada 504 Third Party Lender of the Year (third place). The top lender awards reflect the quantity of SBA 7(a) and 504 loans guaranteed to Nevada businesses, as well as the dollar volume. Nevada State Bank issued 30 loans, totaling more than $24.0 million, in fiscal year 2022.

What information does the SBA need to help with a business’s financing request? Comfort explained, “For start-ups and some acquisitions, they want to see a targeted and detailed business plan, along with projections and details on how to achieve the numbers being presented by the client. For example, perhaps the financing will be used to generate more jobs, which will lead to higher sales and better profitability. Or the financing will be used to purchase better or new equipment, leading to automation, increasing sales, efficiency, and profitability.”

Of course, as with any financing, the SBA and partnering bank will take into account the business’s ability to repay the loan. This is demonstrated by reviewing the financial package during underwriting, she cautioned. The up-side of the SBA loan guaranty is that it is available to borrowers who may need extended time for repayment, or who lack sufficient collateral, or who cannot provide the higher down payment usually required with conventional financing.

What if your business is no longer “small” in the traditional sense? You can still benefit from an SBA loan. There are sizing standards for each industry categorized by the NAICS code of a business, or there are the alternative sizing standards outlined as: a business with less than $15 million in tangible net worth and  greater than $5 million in net profits listed on the last 2 years’ of tax returns.

And if the business is denied an SBA loan? “Then, we do our best to coach and help the client come up with a plan to obtain the financing down the road. We do our best to help them build a road map on what they can work on within their business and as owners, to get qualified, and then we do our best to stay in touch with that customer until the time comes when we can consider an application,” said Comfort.

Besides guaranteeing bank loans, the SBA also offers services and tools to help businesses. Comfort explained that the SBA sponsors SCORE (Service Corps of Retired Executives) and works closely with Small Business Development Centers. These organizations help entrepreneurs understand SBA tools such as business plans, assist with loan applications, and provide low-cost training and counseling.

“My team and I have a passion for helping small businesses,” she concluded. “It’s not just about helping businesses receive funding. We enjoy becoming a partner for that business owner and team and educating them to be successful within the communities that they serve.”

Contact your Nevada State Bank business banker to learn how an SBA loan* can help YOUR small business.

*All loans subject to credit approval. Terms and conditions apply. See a banker for details.