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Honestly lending isnt getting easier my friend. Thousands of people would love to be approved for an SBA at those rates but simply can not. My thought from a lending stand point is that you most likely will not get a better rate off of collateral rather than the SBA loan especially if they are depreciating assets. The SBA loan is a fantastic loan with low rates. I think you should stick with what you have especially if the credit isnt in the 700's. Just my thought.
Replacing a SBA Loan, Welcome
Questions. Do you have an Accountant?? A Federal I D Number??
Does the Sandwich shop have a lease?? How long a lease??
Have you prepared a Cash Flow Report??
How close are you to Chicago??
You will likely have a hefty prepayment on the SBA loan, 7a's are sold on the secondary market, check your note so you are aware of what the prepayment penalty is.
With a little over a year in business, going the conventional route may be difficult. As pointed out above, the small business lending scene is a mess right now so you are better off waiting. You won't be able to refi your existing refi debt with new SBA unless there is at least a 20% savings on the payment of the new debt. What you have now seems fairly standard, so you would bbe forced to go conventional.
Right now the large SBA lenders are all jammed up becuase the secondary market has shut down. Until that unfreezes, even very strong borrowers are being turned away.
If I were yoiu, I would hold off for now.
Thanks for all the great info, I'm going to weather the storm.
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Currently I own a business with my wife and 2 other Partners. We have a SBA loan through National City since early Feb. of 2007. Little background about us, Greg and Melody are husband and wife also. I said little, we want to replace our SBA and use the Business assets as collateral. We have been in Business since Sept. 5th, 2007 and have been doing Okay. Our Business partner and myself want to do some updates to our business and pay off some other expenses. I believe we need about $250,000 - $260,000. Currently we have a 7yr loan and I believe our interest rate is 7.5-8.0. Ideally I would like something with a little longer term and a lower Interest rate. I would rate my wife and myself as fair credit and our partner as good to great. I'm in Illinois Shorewood, IL to be exact, it is a Sandwich business called Jimmy Johns. Any info would be great.