How to Refinance an SBA Loan

In order to refinance SBA loan programs, there are a number of things that you will need to do. Many people get an SBA loan because they believe it to be the best route for them at the time, however, once they get involved with the program, they find that it may not be the best loan program for them. Some of the terms can be confusing and you find out that it is not as good of a deal as it was made out to be. If this sounds like your situation, you may need to refinance the SBA loan and get into one that fits your needs a little better. Here are a few things that you will need to do in case you need to refinance your SBA loan. 

Decide Exactly What You Want

The first thing that you need to do is determine your needs for a new loan. Ask yourself why you are refinancing. In some cases, it may not be in your best interests to go ahead and refinance. Even if you do not like your current loan situation that much, it may be smarter, financially, to stay right where you are. The closing costs of a new loan might eliminate your choice and make staying in your current loan the smarter choice. 

Look at New Loan Types

If you determine that your current loan is not for you, you will then need to determine what kind of loan you want. There are many different kinds of commercial loans out there that could potentially get the job done for you. You could get a fixed rate loan, adjustable rate product, or even a balloon loan that could fit your needs. There are many loan programs to choose from and you need to narrow your options down to move forward. 

Find a Lender

After you know exactly what you are looking for, you need to find a lender that offers what you are looking for. Typically, many different lenders will offer similar programs and you could use any of them. You will want to investigate each lender and find out which one is the best. You want to make sure that you are comfortable with the lender and their policies. You will also want to shop around for the best rates. Interest rates are lender specific and you might be able to find a good deal on a rate if you look around enough. 

Apply For the Loan

Once you find the loan and the lender that you want to go with, you need to apply for the refinance. This process will be about the same that you went through with your initial loan approval. They will determine your credit worthiness, look at your business plan, and evaluate your income. Once you are done with the application process, it will usually be a short time before you know whether or not you were approved. After you are approved, you are free to pay off your SBA loan and start moving forward with the new one. 

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