MCDC LSP Services in Michigan
The 7(a) Loan Program is SBA's primary program for helping start-up and established small businesses, with financing guaranteed for a variety of general business purposes. The SBA does not make loans itself, but rather guarantees the loans. This reduces the risk to the lender but not to the borrower, who remains obligated for the full debt, even in the event of default.
MDCD’s SBA Lender Service Provider (LSP) department services the SBA 7(a) loan program for commercial lenders. Outsourcing your SBA loan applications and other SBA services to Michigan Certified Development Corporation (MCDC) will allow your organization to grow its lending capabilities with limited resources. MCDC will work with your institution to provide proper structuring, underwriting, and documentation to ensure your business loans meet the requirements of the SBA program.
SBA 7(a) Loans
Do you need a business loan in Michigan? The Michigan Certified Development Corporation wants to help you. We match businesspeople in need of loans with appropriate lenders. One type of loan we help facilitate is the SBA 7(a) loan.
SBA Funding in Michigan
The SBA 7(a) loan in Michigan can be used for a variety of business purposes, though it is often used to acquire a business. This type of SBA funding can also be used to purchase commercial real estate, refinance an existing business loan, renovate an existing business, purchase new or used equipment for a business, expand a business or refinance debt. In fact, one of the best parts about an SBA 7(a) loan is that it provides ample flexibility for business owners who need loans for a wide variety of different purposes.
Those who apply for an SBA 7(a) loan in Michigan often have little funding of their own for a down payment, and that’s what makes this particular SBA loan right for them. An SBA 7(a) loan often requires only 10% down, although your lender could require a down payment as high as 30% if you are establishing a new business, versus financing some aspect of an existing business. However, in some instances, you may qualify for a down payment that is even lower than 10%.
SBA Business Loans
SBA 7(a) loans in Michigan are partially guaranteed by the government. This helps lift some of the risk off the lender, who can then offer you more favorable interest rates on your loan. Additionally, because an SBA 7(a) loan is usually a higher risk than an SBA 504 loan, the interest rate is often variable rather than fixed. For the same reason, fees associated with an SBA 7(a) loan may also be higher.
In some instances, it is more advantageous to apply for an SBA 504 loan; however, these loans cannot be used to purchase a business or as working capital.
Applying for an SBA 7(a) Loan
Getting an SBA 7(a) loan is a faster and more efficient process than you may think. In fact, when you go through the MCDC, you can get your SBA 7(a) loan in as little as 30-45 days. That’s because we only partner with experienced lenders who can complete the process faster.
We start by asking you a few questions about your loan, such as how much you need — SBA 7(a) loans are only available in amounts up to $5 million — and what you plan to use it for. We then match you with the best lender for you, and the process of collecting documentation begins. Once your paperwork is complete, all you need to do is wait for approval.
MCDC: Helping Michigan Business Owners
The MCDC has been helping Michiganders establish and finance businesses since 1982. Our goal is to help fuel economic growth and prosperity in our state by facilitating business loans, namely the SBA 7(a) loan in Michigan. To apply or for more information about getting a business loan in Michigan, contact us today.