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Small Business Loans (SBA)

Through our partnership with the U.S. Small Business Administration (SBA), we are proud to offer SBA financing to local businesses. In fact, First Northern Bank is an SBA “Preferred Lender” — so we have extensive experience in helping businesses get a leg up with this financing solution tailored to small business’s needs. We offer both SBA 7(a) loans and SBA 504 loans.

Summary
  • Available for start-up businesses, as well as purchasing and refinancing existing businesses
  • Government-assisted help for businesses that might otherwise have difficulty getting approved
  • Special financing for qualifying businesses
  • Competitive rates for a wide range of business needs:
    • Commercial real estate purchase
    • Construction
    • Business acquisition or expansion
    • Equipment/inventory purchase
    • Working capital
    • And more
  • A wide range of lending options available
  • Generally lower down payments and extended terms
  • Quick, local decision-making and processing
  • Detailed, attentive service from start to finish

Learn More

For more information about SBA loans, view our SBA Loan Frequently Asked Questions below or contact any one of our experienced SBA lending professionals.

Do You Qualify?

You can qualify for an SBA Loan if your business is:

  • A for-profit organization (other loan programs are available for non-profit organizations)
  • Independently owned
  • Not exceeding the following maximum size standards:
    • Manufacturing – varies by industry from 500 to 1,500 employees
    • Wholesaling – up to 100 employees
    • Service – varies by industry from $5.0 million to $25 million in revenue
    • Commercial real estate must be 51% occupied by your business if you are purchasing the building, or;
    • Must be 60% occupied by your business if you are constructing the building
7(a) and 504 Loan Programs

7(a) Loans

The SBA 7(a) Loan Program is a loan guarantee program that may be used for a variety of business needs. Loan proceeds may be used for business expansion capital, equipment purchases, commercial real estate acquisition, the purchase of a small business, or to start up a small business.

504 Loans

The SBA 504 Loan Program provides long-term, fixed-rate, subordinate mortgage financing for acquisitions and/or renovation of capital assets including land, buildings, and equipment. Virtually all types of for-profit businesses are eligible for this program.

SBA Loan FAQs

What is the purpose of the Small Business Administration (SBA)?

Congress created the Small Business Administration in 1953 to help America's entrepreneurs form successful small businesses. The SBA enables its lending partners to provide financing to small businesses on reasonable terms by guaranteeing major portions of loans made to small businesses.

Do I qualify for an SBA loan under the current guidelines?

Yes, if your business is:

  • A for-profit organization (other loan programs are available for non-profit organizations)
  • Independently owned
  • Not exceeding the following maximum size standards:
  • Manufacturing--varies by industry from 500 to 1,500 employees
  • Wholesaling--up to 100 employees
  • Service--varies by industry from $5.0 million to $25 million in revenue
  • Commercial real estate must be 51% occupied by your business if you are purchasing the building, or; must be 60% occupied by your business if you are constructing the building

What are the advantages of an SBA loan?

The SBA loan program offers:

  • Up to 90% loan to collateral value
  • Longer repayment periods--up to 25-year terms for real estate
  • No prepayment penalties for loans up to 15-year terms
  • No balloon payments

What purposes can I use an SBA loan?

You can finance:

  • Working Capital
  • Inventory Purchase
  • Machinery & Equipment
  • Furniture & Fixtures
  • Commercial Real Estate
  • Purchase
  • Improvements
  • Construction
  • Any combination of the above can be made as one loan
  • Acquisition of an existing business

What are the loan amounts and interest rates charged?

Our lending experts can make it easy for you to obtain the funding you need. We offer:

  • Loans from $50,000 to $2,500,000
  • Negotiable rates
  • Adjustable and fixed rates

Interest rates vary depending on the type of SBA loan for which you are applying. Contact any of our experienced SBA lending professionals for more information.

Do I need to put up collateral to obtain an SBA loan? What is eligible?

Yes. Eligible collateral includes personal and/or business real estate; equipment, inventory, and accounts receivable; and personal guarantees of all major stockholders (20%+).

How long can I take to repay an SBA loan?

The following applies for repayment terms:

  • Working Capital & Inventory--up to 7 years
  • Machinery & Equipment--up to 10 years
  • Commercial Real Estate--up to 25 years

A loan that combines two or more of the above purposes will have a weighted average maturity.

What would disqualify me for the SBA loan program?

If any of the following items apply to you, it will not be possible for you to obtain an SBA loan. However, there may be other reasons than listed below that would preclude you from obtaining an SBA loan, e.g., your business doesn't qualify as a small business. If you're unsure, contact a First Northern Bank SBA Lending Expert today.

Listed below are guidelines that could disqualify you for SBA financing:

  • I am not a U.S. citizen and do not have an alien registration card.
  • I do not independently own my business (the business has other owners who will not be part of the application).
  • I own a not-for-profit business.
  • My business exceeds the SBA size standards.
  • My business (or proposed business) is engaged in gambling activities.
  • I am currently on parole or probation.
  • My loan would allow for speculation in any kind of property.
  • My business engages in lending.
  • My business is not available to the general public (enforces restrictive patronage).
  • My business or I have defaulted on a previous Federal Government debt (including student loans).

How do I apply for an SBA loan from First Northern Bank?

Applying for an SBA Loan is easy at First Northern Bank, simply:

What else does the Bank need to begin my loan?

Along with the completed loan application, please bring or mail the following to one of our SBA Loan Offices:

  • Current company financial statement--less than 45 days old
  • Previous 3 years company financial statements and tax returns
  • Personal financial statements and previous 3 years tax returns from all major stockholders (20%+)
There's no time like the present to get started.

*Loan maturities are based on the ability to repay, the purpose of the loan proceeds, and the useful life of the assets financed.