In my small business class the other day, the teacher made an interesting note to debunk something that you many people say about the SBA (Small Business Administration).
With entrepreneurship and starting a business, many people will say “go to the SBA, they give you money to start your company or will give you loans.” Well, this isn’t necessarily true.
If I remember correctly, the last time I looked at the SBA website, they may give away a little bit of money, but for the most part, you don’t want to go to the SBA for loan help, you must first have tried to approach many banks on your own first hand and get denied. If you than go to the SBA, they will underwrite you for the loan that you apply for with a bank. Usually they will back you for up to 70% of the loan.
So, the SBA doesn’t necessarily just vice money out or loan it straight to you, they make it possible for you to get a oan from a regular bank that you may have been previously denied by.