SBA Hotel Loans
Alliance specializes in SBA Hotel Loans for owner/operators of hospitality properties located throughout the U.S. We can assist with a refinance request (must meet SBA requirements for a refinance), a new purchase loan or a construction loan to build a new hotel.
SBA Loans provide a higher leverage to borrowers, up to 85% on existing properties, and up to 80% loan to cost on new construction requests. In most cases, and in exchange for the higher leverage, you will pay a fee to the SBA which provides the bank a partial guarantee and makes the loan less risky for the bank.
Alliance only works with a handful of banks who have a willingness to lend on hotel properties and understand the hotel business.
When you deal with Alliance for an SBA Loan on a hotel you can rest assured your loan request will be handled in a professional manner and that we will make every effort to get your loan request approved and closed with a loan structure that works for you.
SBA Hotel Loan Programs
This is our most popular loan program for financing hotel properties. We have a fast efficient process and can typically review a hotel financing request within 2 business days and have a term sheet to you within 2-3 business days. Our closing ratio on hotel loans when a term sheet is provided is second to none.
SBA 7(a) Loans are available through Alliance Business Capital from $350,000 to $5,000,000
Some Benefits of the SBA 7(a) Loan include:
- Longer repayment terms, up to 25 years on real estate
- Frees up cash to expand your business
- Low down payment of as little as 15% on Hotel Properties
- Construction Financing, PIP Financing, FF&E Financing are all eligible under the SBA 7(a) Loan Program
- Seller Financing is allowable as a 2nd Mortgage under certain conditions – would still require a minimum of 10% borrower injection
- Closing timeframe of 45- 60 days
| Minimum Loan Amount: | Typically $500,000 but will consider less on a case by case basis |
| Maximum Loan Amount: | $5 Million - can possible go higher with a Pari Passu Loan |
| Maximum Loan to Value: | 85% Maximum |
| Use of Proceeds: | Business Acquisition, Expansion, New Construction, Purchase Equipment or FF&E, Purchase a New Building and Land, Lease-hold Improvements, Working Capital, Refinance Debt (for compelling reasons) Purchase Inventory, Start a Business |
| Minimum Credit Score: | 680 is preferred minimum with exceptions |
| Who Qualifies: | Must be a for profit business & meet SBA size standards, show good character, credit, management, and ability to repay. Must be an eligible type of business. |
| Prepayment Penalty: | Typically a 3 year prepayment penalty, however lender determined. |
| Terms: | Up to 25 years on Real Estate 5-10 Years on Working Capital, Machinery and Equipment Loans. |
SBA 504 Loans available up to $15,000,000
Some Benefits of the 504 Loan include:
- Lower down payment than a Conventional Loan-typically 15 -20%
- Long repayment terms – reducing monthly payments
- Frees up cash flow to expand your business
- Many rate options including long term fixed rates
- Associated fees and soft costs may be financed in the loan
| Minimum Loan Amount: | Varies from Lender to Lender. Alliance has a $2 Million minimum on a 504 Loan |
| Maximum Loan Amount: | $10 Million 1st Conventional Loan $5 Million CDC/SBA |
| Maximum Loan to Value: | 80% CLTV Breakdowns as follows: 50% Conventional 1st Mortgage 30% CDC Loan 20% Borrower Injection |
| Use of Proceeds: | Long-term, fixed asset loans, Construction, New Purchase and Refinance (with compelling reason) |
| Loan Term: | Typically 10-20 Years |
| Minimum Credit Scores: | Typically a minimum middle score of 680 with exceptions is required. |
| Who Qualifies: | For-profit businesses that do not exceed $15 Million in tangible net worth, and do not have an average two full fiscal net income over $5 Million. Must be a minimum of 51% owner occupied on existing properties or 60% on new construction. |
| Benefits to Borrower: | Lower down payment than a conventional loan, long term financing with no balloons. |
We ask for a lot of items upfront so that we don’t have issues late in the loan process. In order to receive a term sheet we will need the following forms and documents on all shareholders, partners, owners.
- SBA Personal Financial Statement – must be completed in detail
- SBA Resume Form – need completed in detail with job descriptions etc.
- Loan Intake Form
- Credit Authorization – cost of credit is approximately $25 per individual depending on State tax
In addition to the above forms we will need the following documents:
- Most recent 3 full years of Business and Personal Tax Returns complete with all schedules including any W-2 and K1 Statements. We will need business returns on all businesses owned.
- Clear copy of Government issued ID
- Copy of last 2 months asset statements – need the complete statement including blank pages
- If a purchase we will need a copy of the purchase contract
- If a refinance we will need a copy of your existing note(s)
Click here for an SBA Checklist of items.
Please upload all documents to http://alliance.leapfile.net whenever possible or if you prefer email to allianceloans@msn.com
If you have questions about one of the SBA Loan Programs offered through Alliance please do not hesitate to Contact Us.