Can you get a loan to pay for SBA down payment

by SeparateGrab. Posted on Sep 14, 2020    1    9


Hello,

Does anyone know if it’s ok to get a loan from say a non profit to pay for a down payment on a sba loan I have about 30,000 saved but I need a 300,000 k loan and apparently SBA usually asks for 20% down payment so I’m just wondering how to make this happen.

Thank you,


Comments

exportedthoughts 1

Is this a real estate transaction? 95% of the time there is 0% down payment for 7(a) Even if you were doing a 504, you still have the option to wrap it under a 7(a)

Also a loan to have the down payment is ineligible. They will require proof of proceeds which is essentially bank statements

  SeparateGrab 1

No its a regular business loan. What do you mean by ineligible, does that mean it’s not possible? Thank you

exportedthoughts 1

Correct, but you should look to see if there are options where you do not need to put a down payment. Is this a start up loan?

Loucha 1

I actually believe you may be allowed as long as you can repay the loan from an unrelated source of income.

https://www.sba504blog.com/sba-down-payment/

Also, SBA 7a and 504 allow up to 90% financing. The bank you are dealing with can require 20% so shop it around with different lenders.

  SeparateGrab 1

Omg I so hope this is true! Thank you

Johidi 1

Whats the difference between the two? I'm going to be applying for one in the next couple months, but not sure which one to go for. I'll be purchasing a property that is currently owner financed, but that is coming to end so I need to get a loan of my own. About $600,000.

Loucha 1

I suggest you do some research and read up on the two. A 7a can take 2-3 months from start to finish while a 504 can take longer so you want to get the process started.

Fuglie_Gamer 3

Would have to read the documents. Some say you can’t finance the down payment. Also they will be able to tell if you do. Just be careful. Could be considered fraud if you can’t and find away to do it.

  SeparateGrab 1

Thank you