Merchants Bank of Indiana's SBA Group Finances National Hotel Chain, National Fast Food Franchise
June 14, 2021
When looking to start or grow a business, small business owners are often in need of financial support. Merchants Bank of Indiana (MBI) tracks the latest Small Business Administration (SBA) updates to keep our customers informed and help them build or expand their operations.
No matter the type of small business, Merchants Bank is here to help. We provide a variety of services for any financial situation, and one way to achieve this is thorough a 7(a) loan. This loan program is the SBA's most popular option and includes financial help for small businesses with special requirements. This is the best option when real estate is part of a business purchase, but it can also be used for:
Short- and long-term working capital.
Refinancing current business debt.
Purchasing furniture, fixtures and supplies.
The maximum loan amount for a 7(a) loan is $5 million. Key eligibility factors are based on what the business does to receive its income, its credit history and where the business operates. Your dedicated lender will help you figure out which type of loan is best suited for your needs.
Recently, our SBA Group closed 7(a) loans for both a national hotel chain and a national fast food franchise. For the hotel, we helped our customer receive a 25-year, $5 million loan for the purchase of a property in Oklahoma. For the national fast food franchise, we assisted our customer in securing financing for the acquisition of two franchised restaurant locations in Anderson, Indiana. The total loan amount of approximately $851,000 allowed for the completion of the acquisition, including real estate and goodwill, and provided additional funds for furniture and fixtures, inventory and working capital.
For the 7(a) program, the SBA sets guidelines for loans made by its partnering lenders - and even designates some lenders as part of the PLP (Preferred Lenders Program), of which MBI is a member. This accreditation allows us to make the final credit decision, which in turn speeds up the approval and closing process.
Notably, from now until September 2021, all 7(a) loans have an increased guarantee from 75% up to 90% and a waiver of all borrower guarantee fees under the CARES Act. In addition, SBA will also cover three months' worth of payments (up to $9,000 a month) on loans approved and fully disbursed before Sept. 30, 2021.
Looking to explore financing options for your small business? Contact us today for assistance.