A LENDING DIVISION OF FIRST STATE BANK NEBRASKA

How Working with An SBA Preferred Lending Partner Improves the Lending Process

14 Nov
Preferred lending partner

How Working with An SBA Preferred Lending Partner Improves the Lending Process

When applying for a business loan, you want to take advantage of every opportunity to speed up and streamline the lending process so your business can get the funds it needs as soon as possible. In addition to being prepared with key documents  and being a responsive and responsible borrower, another way you can enjoy a simpler and faster SBA loan experience is by working with an SBA Preferred Lending Partner.

As we’ve mentioned in previous posts, as a government service, the SBA guaranty loan program has stringent requirements for vetting applications. This is important and necessary in order to ensure sound stewardship of public dollars. The benefits to borrowers are significant enough to offset the added requirements, however, it’s always nice when a borrower can avoid the traditional bureaucratic process and get to closing faster. In order to do that, the SBA began the Preferred Lender Partner initiative, which rewards quality lenders with a proven track record of vetting and packaging quality loans with certain privileges not afforded to all lenders in the SBA loan process.

Who Can Become A Preferred Lending Partner?

To become a Preferred Lending Partner, a lender must have a proven track record of successful packaging and management of SBA loans extending back at least two years. Additionally, a lender must have the ability to create and evaluate a complete loan package as well as have the means to process, close, service and liquidate loans. The SBA scrutinizes a lender’s ability to mitigate risk across the board and also requires that the lender maintain a Supplemental Guarantee Agreement for a maximum term of two years.

The Advantages of Working with a Preferred Lending Partner

Once a lender becomes an SBA Preferred Lending Partner (PLP), they enjoy many privileges and benefits – and so does the borrower. The first advantage is that PLP’s can approve their own loans, instead of waiting for SBA approval. Second, PLP lenders always receive priority consideration for all questions, checks, and submittals. The typical wait time for a response on a submittal is 1-2 weeks for non PLP lenders. PLP lenders, on the other hand, can get responses in as little as 1-2 days. This advantage is significant in normal circumstances, but when dealing with situations like a potential government shutdown, this advantage can make or break a time sensitive loan.

In addition to the time and approval advantages, PLP lenders are able to originate and service SBA loans just like they would any other loan product. This incentivizes lenders to offer more SBA loans, which provides greater options to potential borrowers.

Saltcreek is an SBA Preferred Lending Partner and we have seen how this designation has provided our clients with significant advantages during the loan process. If you have questions about what it means to be an SBA Preferred Lending Partner, or about the SBA loan program in general, contact a Salt Creek advisor today.

 

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