Grow your business with a self-storage expert. Our extensive experience lending to self-storage business owners has led to more than $275 million in loan closings. With the SBA 7(a) program, we provide guaranteed loans, up to $5 million, for business acquisitions, debt refinance, ground-up construction and expansion projects. As an SBA lender, current guidelines allow us to offer eligible small business owners:
- Financing up to 25 years.
- Fully-amortizing loans. Allows you to avoid refinancing every few years, giving you more time to focus on your business. Just make your loan payments on time and comply with your loan terms.
- No restrictive financial covenants. Under current guidelines, changes in your balance sheet ratio or property value will not cause an acceleration of your loan payments.
- Flexibility to refinance your 7(a) loan. The prepayment penalty is only 5% in the first year, 3% in the second year and 1% in the third year. After the third year, there is no prepayment penalty.
- An interest-only period of up to three years is available for construction and expansion requests.
- An LTV up to 85% based on an “as is” or “as complete” value, without being required to look at additional collateral.
- Equity injection usually not exceeding 15%. For debt refinance, an injection may not be required.
SBA loans are full recourse transactions for 20%+ owners. However, SBA guidelines like those above provide more favorable terms, compared to conventional or other sources of financing. There is a one-time fee payable to the government. TCF Bank charges a packaging fee that is typically $2,500, if you choose us to package your loan. Ultimately, you can save money by not having to incur similar bank and other fees from having to refinance every few years.