SBA Lenders:

How many SBA lenders have approved loans to wealth management advisors?

As of 6/30/2024 there have been 464 SBA lenders have approved a loan to a Wealth Advisor all-time. In the last 12 months 61 different SBA lenders approved an SBA loan to an advisor.

How does AdvisorLoans compare to SBA lenders?

#1 for SBA Lending to Advisors Last 5 Years AdvisorLoans is the #1 SBA 7(a) loan originator for total funded loans to financial and investment advisors over the last 5 years.

AdvisorLoans has funded more SBA loan dollars for advisors than any other institution over the last 5 years while still averaging over $1 million per loan.

1/3 of funded SBA loan dollars to advisors over the last 5 years was originated by AdvisorLoans with 168 lenders making up the two-thirds.

Million Plus SBA Loans AdvisorLoans has 35% market share of all $1M plus loans funded to advisors.

Of the 168 banks approving SBA loans to advisors over the last 5 years there were 42 banks which funded $1M+ loans.

• 32 of these banks funded one loan over five years over $1M. 2 banks funded 5 or more $1 million plus loans. AdvisorLoans has over 50 funded million plus SBA loans during this time.

And over the last 2 years, AdvisorLoans has 9x more $1M+ SBA loans funded than 14 of 15 banks have to advisors.

Multi-Million SBA Loans AdvisorLoans dominates multi-million SBA loans to advisors. AdvisorLoans has a 51% marketshare of all funded SBA dollars to advisors over the last 5 years for loans between $1 to $4 million and a 39% market share of all multi-million SBA loans to advisors.

AdvisorLoans has a 49% market share for loans between $2-3 million and a 54% market share of loans between $3-4 million over the last 5 years.

AdvisorLoans doesn’t advertise (including Google ads), we do not blast advisors with email marketing, and with rare exceptions advisors don’t see us at conferences. Our market share is driven almost completely from referrals. While some advisors will prefer to work with banks direct and try to figure out everything on their own, other advisors appreciate the loan advisor to financial advisor model we pioneered a decade ago.

Are all SBA lenders essentially the same?

Perhaps the biggest misperception about SBA lending is that all SBA lenders are essentially the same. While the SBA rules are the same for all, the SBA lenders providing the loans, can widely vary from each other. Each SBA lender has their own set of additional qualifying criteria, policies, and requirements that is stacked on top of the SBA rules and requirements. The SBA also defers many of their requirements to the lender’s standard policies, which widely differ lender to lender.

See article: How SBA Lenders Differ That Impacts An Advisor’s Approval And Loan Amount

Why is it one SBA lender would reject me while another approve me?

We call this the SBA approval differential dilemma. It is the dilemma where a borrower can be declined for an SBA loan at one lender but approved by another. This is due to different SBA lenders having different criteria, policies, preferences, and requirements from each other.

What are the key areas in which SBA lenders differ from each other?

While the SBA rules are the same for all, the SBA lenders that provide the loans widely vary from each other. Besides the fundamental differences in experience, expertise, and focus on advisor lending, different SBA lenders have different and varying qualifying criteria.

One SBA lender may require 50% more free cash flow than another; one may prohibit previous bankruptcies that another lender is okay with; one might require a cash down payment while another doesn’t if the advisor meets the SBA’s equity injection requirement; one may have a minimum AUM, revenue, or loan amount requirement while another lender doesn’t; one may allow for startups and another doesn’t; and one lender may take several months to close the loan while another can get it done in about 6 weeks. These are just a few of the differences.

Why wouldn’t my local bank be the best option to do a SBA loan with?

While a local bank may feel like the right place to start because they “know” the borrower, it’s very rare that your local bank has experience or expertise in navigating SBA loans in general more-or-less for the wealth management industry niche. Most SBA lenders only do a handful of SBA loans a year for all industries. Top SBA lenders who are focused on the advisor lending space is a much better option for an advisor seeking to get an SBA loan as quickly and smoothly as possible.

What are the 3 most important factors in selecting a SBA lender?

1. Experience - Expertise and experience providing SBA loans to wealth management industry advisors.
2. Focus - Currently focused and motivated to lend to advisors like you, for the loan purpose you are seeking, for the loan amount you need. Those who want your loan.
3. Criteria - Has policies and requirements for qualifying (credit score, cash flow, start-ups, collateral, type, previous bankruptcy or judgments, etc.) that matches your criteria situation.

Does it matter if a SBA lender is a Preferred Lending Partner (PLP)?

Yes. SBA lenders who are not PLP lenders have to submit the loan to the SBA for their approval which can add weeks to the process. PLP lenders approve their SBA loans in-house.