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Small Business Lending is Improving: Tips for Finding and Securing the Right Loan

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Small Business Lending is Improving: Tips for Finding and Securing the Right Loan

By Caron_Beesley, Contributor
Published: June 11, 2012 Updated: August 18, 2016

If you are looking for capital to finance your startup or business growth, many signs suggest that lending markets are showing renewed vigor.

Earlier this spring, for example, SBA Administrator Karen Mills blogged about the new signs of strength in business lending. Among the positives, Mills noted that:

  • Thanks to the Recovery Act and the Small Business Jobs Act, SBA had a record year in FY2011, supporting more than $30 billion in small business lending across the country.
  • The FDIC recently released data showing that banks had their biggest increase in business lending in four years.
  • Financial institutions (mostly community banks) are reporting an increase in their small business lending by $3.5 billion, thanks to the Department of Treasury’s Small Business Lending Fund.

And anecdotally, Administrator Mills is hearing from small business owners that “…they are no longer telling me they’re fighting for survival; they’re talking about needing a loan to take advantage of a new opportunity, hire another worker or buy more inventory.”

Recognizing that more needs to be done, Mills said SBA is working with some of the largest lenders around the country, who last year committed $20 billion to small business lending over the next three years. The SBA is also working to streamline its processes to make it easier for small business to use and benefit from SBA loan programs.

Looking for a Business Loan?

If your small business has struggled to get financing in the past, or if you’re thinking of getting a loan to fund new growth, here are some tips to help you understand what SBA loans are available, where to get them, and how to prepare a successful loan application. This useful Loans and Grants Search Tool can also help you identify federal, state and local government financing programs that may be available to help you start or expand your business.

Find the Right Lender

If you are new to small business financing, it’s worthwhile to talk to your local SBA District Office. Local office staff can help you understand options from community and national banks. They can also provide guidance about loan eligibility and application requirements. If you are a veteran or a woman-owned business, you can get specialist advice about programs that meet your needs at a local Veterans Business Outreach Center or Women’s Business Center.

If you are doing your own research, seek out a bank or credit union that has been through this process before or one that is a Preferred SBA Lender – in other words, a lender who has a proven track record in processing and servicing SBA loans.

Prepare a Loan Proposal

One important step in the application process for regular business loans and SBA-backed loans alike is to prepare a written loan proposal. This document helps you position yourself, your business and your plans for growth as solid, trustworthy and viable. You’ll need to include personal and business financials that document your net worth and sales projections, which impacts your ability to repay the loan.

If you are applying for an SBA loan, you’ll need to complete a few additional forms that the lender will include with your loan application.

SBA offers several free online courses about how business financing and SBA financing work.  These self-paced courses take about 30 minutes to complete.   

To help you properly prepare your loan proposal and other application requirements, SBA offers several step-by-step guides:

  • SBA Loan Application Checklist – As you work with your lender to prepare your application, here’s a quick overview of the forms and supporting documentation you’ll need to prepare.
  • Business Loan Application Checklist – If you are applying for a business loan not administered by the SBA, you’ll find that most lenders require the same type of information from potential borrowers. This guide explains what you can expect to provide.


About the Author:

Caron Beesley


Caron Beesley is a small business owner, a writer, and marketing communications consultant. Caron works with the SBA.gov team to promote essential government resources that help entrepreneurs and small business owners start-up, grow and succeed. Follow Caron on Twitter: @caronbeesley


I am learning alot of infor about sba. The questions the lenders would want and the forms too.
I would find preparing a loan proposal a bit intimidating. Great that there are resources that can help with things like that, especially since they're free courses.
The small business loan process could be tidious and time consuming if you aren't familiar with the process. Some online research could shed some light on different sources and workshops available to help entrepreneurs put their applications together correctly, sometimes at no cost. Based on my experience, the reason most people are denied is because they do not submit a full/thorough package.
I’m extremely pleased to discover this web site. I need to to thank you for your time for this fantastic read!! I definitely savored every little bit of it and i also have you book-marked to see new things in your website.
Most times, no matter how fantastic your business proposal has been written and presented, most times the right lenders always want to see how they would get their money back just in case the business on paper fails to meet it said profit.
Great post. I particularly like the Loan and Grant Search Tool. I was recommending my audience just to use Google, but this should be much more targeted. Thanks!

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