SBA Loans for Veterans: Learning How to Get a Great Veterans Business Loan

A Veteran SBA Loan is a specialized financing solution backed by the U.S. Small Business Administration (SBA), specifically tailored for military veterans to start, grow, or purchase a small business. The SBA understands there are unique challenges that veterans face when pursuing financing for their small businesses. To address these obstacles, the SBA developed specialized lending programs specifically for veterans, to provide financial support. These loan programs offer valuable benefits, including reduced loan fees, competitive interest rates, and veteran specific resources such as networking and training, enabling veteran entrepreneurs to access the funds they need for their small businesses. Entrepreneurs benefit significantly from these SBA programs, which enable easier access to loans compared to traditional small business loans.

Among the most prominent SBA lending options for veterans are the SBA 7(a) and SBA 504 loans. The SBA 7(a) loan offers versatile funding suitable for various small business needs, including working capital, inventory management, purchasing equipment, and debt refinancing. Alternatively, the SBA 504 loan is specifically crafted to finance larger investments such as commercial real estate and long-term equipment purchases, featuring fixed interest rates and favorable repayment terms. Ultimately, SBA loans for veterans provide essential financial resources, empowering veterans to pursue their business ambitions confidently and successfully transition from military service into entrepreneurship. An SBA loan for veterans represents an ideal funding solution, fostering sustainable business growth for veterans across diverse industries.

Veteran small business owners have access to two primary SBA business loan programs: the SBA 7(a) loan and the SBA 504 loan. Both programs are specifically designed to support veterans in launching, expanding, or acquiring small businesses, providing flexible financing solutions tailored to their unique business needs.

The SBA 7(a) loan is the most versatile lending option, ideal for veterans seeking funds for general business purposes such as purchasing inventory, buying equipment, refinancing existing debt, or securing working capital. Veterans benefit from lower fees, competitive interest rates, flexible repayment terms, and the ability to finance a wide range of business expenses, making it the preferred choice for many small business owners.

The SBA 504 loan, on the other hand, focuses primarily on significant, long-term investments. It is specifically structured for veterans planning to purchase fixed assets like commercial real estate or large fixed assets like machinery and equipment. The 504 loan offers fixed, below-market interest rates and long-term repayment options, typically spanning 10 to 25 years. This structure allows veteran-owned businesses to manage larger capital investments effectively while conserving cash flow.

The SBA 504 loan is another valuable option, especially for financing fixed assets such as commercial real estate or large equipment. With long-term, fixed-rate financing, this program allows for long-term financial planning and helps business owners manage expenses more effectively.

At First Bank of the Lake, we go even further to support veteran borrowers by waiving packaging fees, offering a 0.50% discount on rates, providing SBA fee waivers on loans under $1,000,000, and our lending team veterans loan is made up of veterans who understand the challenges veteran business owners face securing financing.

In addition to these core programs, the SBA also supports veterans through the Veteran Advantage initiative. This program streamlines the application process and reduces fees for qualified borrowers. For guidance and resources, veteran business owners can also tap into SBA-affiliated support centers like Veterans Business Outreach Centers (VBOCs), which offer networking, business training, counseling, and help navigating loan options.

SBA loan terms for veteran-owned businesses are generally the same as those offered to any eligible small business, but veterans may receive added financial benefits like reduced fees. The most commonly used SBA loan is the 7(a), which provides flexible terms based on the intended use of funds. For example, working capital loans and equipment financing typically have repayment terms of up to 10 years, while loans used to purchase real estate can extend up to 25 years.

Interest rates are usually variable, based on the prime rate plus a lender’s markup, but the SBA sets maximum limits to keep rates reasonable. SBA loan amounts range from a few thousand dollars to $5.5 million, depending on the borrower’s needs and qualifications.

Veteran-owned businesses may benefit from lower upfront costs. For instance, the SBA often reduces or waives its guaranty fee for veterans on loans under $1 million. Some lenders, like First Bank of the Lake, offer even more incentives—such as interest rate discounts and waived packaging fees.

Borrowers looking to use an SBA veterans business loan for their growth should have a solid personal credit history, as lenders usually prefer applicants with good credit scores and a clear ability to repay debts. Lenders will also evaluate the overall financial health of the business by reviewing documents like financial statements, recent tax returns, cash-flow projections, and detailed business plans. To qualify as a veteran-owned business, veterans must own at least 51% of the company. This majority ownership ensures the business meets the criteria for specialized veteran-focused SBA lending programs.

To qualify for a veteran SBA loan, the business itself must meet the SBA’s general eligibility requirements. Meaning, the business must be for-profit, operating in the U.S., fall within the SBA’s size standards for small businesses, and show the ability to repay the loan. These criteria are designed to ensure that the loans go to businesses with solid potential—giving veteran entrepreneurs the funding they need to start strong, finance growth, and successfully manage their businesses.

Veterans Business Outreach Centers (VBOCs):The SBA operates 31 VBOCs nationwide, providing services such as networking, business training, counseling, and resource referrals. These centers offer key guidance to help veterans develop business plans, understand SBA veterans financing options, and navigate the complexities of running a small business. VBOCs also collaborate with the military to deliver the “Boots to Business” program, offering foundational entrepreneurial education to transitioning service members and their spouses.

SBA Business Loan Programs with Veteran Benefits: Veterans may access SBA-backed loans, including the 7(a) and 504 loan programs, which offer favorable terms for various business needs. Additionally, the SBA’s Veteran Advantage program provides fee reductions on certain loans for eligible veterans, making financing more accessible and affordable.

Federal Contracting Opportunities: The SBA’s Veteran Small Business Certification (VetCert) program enables service-disabled veteran-owned small businesses (SDVOSBs) to compete for federal contracts that are specifically set aside or awarded to veteran-owned businesses. In addition veteran-owned small businesses (VOSBs) that are certified through VetCert can access even more contracting opportunities through the Department of Veterans Affairs’ Vets First program.

Veterans may qualify for fee reductions or waivers, which can significantly lower the overall cost of the loan. For example, under certain SBA programs, the upfront guaranty fee is reduced or waived for veteran borrowers, especially on loans under $1 million. While this doesn’t directly lower the interest rate, it reduces the total cost of borrowing.

Individual lenders may also offer additional rate discounts or incentives for veterans. At First Bank of the Lake, for example, veteran borrowers receive a 0.50% rate discount, along with waived packaging fees. These benefits can make SBA veterans financing more accessible and cost-effective for veterans looking to start or grow their business.

Before applying, veterans should start by choosing the right loan program for their business’s needs. The SBA 7(a) loan is the most common option, providing flexible funding for most business expenses including working capital, equipment, or business acquisitions. The SBA 504 loan is another choice for those looking to purchase real estate or large fixed equipment. While the SBA sets and guarantees a portion of the loan and sets lending guidelines, the loans themselves are provided by participating lenders, such as banks, credit unions, or specialty SBA lenders.

The first step is to confirm your business meets the eligibility requirements. Businesses must be for-profit, operate in the U.S., meet the SBA’s size standards, and demonstrate the ability to repay the loan. You’ll also need to gather key documents, including a business plan, financial statements, personal and business tax returns, and proof of veteran status if you’re seeking veteran-specific loan benefits.

To get started, veterans can contact an SBA-approved lender like First Bank of the Lake or reach out to a local Veterans Business Outreach Center (VBOC) for guidance. These centers offer free assistance with loan preparation, business planning, and navigating the SBA process.

• A nationwide SBA lender
• Deep expertise in your loan area whether it be franchises, construction or startups. Support for veteran-owned businesses if you are looking for a veteran’s loan.
• Proven experience in funding the growth of small businesses
• A reputation for flexibility in working with borrowers, along with creative problem-solving abilities to ensure the best outcomes
• Friendly and helpful staff members, knowledgeable in the complexities of SBA lending and the benefits available for veteran small business owners.

At First Bank of the Lake, we offer all these characteristics and more. With a team that includes veterans, a strong focus on SBA lending, and personalized support, we’re committed to helping veteran-owned businesses access the capital they need to grow and thrive.

First Bank of the Lake is proud to support veteran-owned small businesses through the SBA loan process. Whether you’re launching a new business, buying into a franchise, or expanding an existing business, our team is here to guide you through the SBA veterans financing process with clarity, support, and unmatched experience.

Here’s what veteran small business owners can expect when working with us:

• Specialized veteran lending team: Our SBA loan group includes former service members who understand the financial challenges veterans face and how to overcome them.
• Proven expertise: We’re one of the top SBA lenders and SBA Franchise lenders in the country, with a dedicated team that focuses exclusively on franchise and small business financing.
• Low down payments: SBA 504 and 7(a) loans both require as little as 10% down, helping you preserve cash while accessing the capital you need.
• Fast responses and efficient closings: We move quickly, so you can too. Our process is built for speed and reliability—from approval to funding.

At First Bank of the Lake, we’re proud to serve those who’ve served. As an SBA 7(a) Preferred Lender, we’ve earned a reputation for delivering personalized, efficient financing solutions and we bring that same commitment to every veteran-owned business we support. We’re ranked in the top one percent of SBA 7(a) lenders nationwide and have funded over $500 million in SBA loans in the past year alone.

Our dedicated team of armed forces vets understands the unique needs of veteran entrepreneurs and provides hands-on guidance through every step of the SBA loan process. We handle the heavy lifting—from application to closing—so you can stay focused on building and growing your business. We proudly offer exclusive benefits for veteran borrowers, including reduced fees and interest rate discounts, making capital more accessible and affordable. At First Bank of the Lake, we don’t just process loans—we build partnerships. Our goal is to enable and support veteran-owned businesses while strengthening communities across the country through reliable, experienced SBA lending.

The friendly financial experts at First Bank of the Lake offer SBA loans designed with the needs of our customers in mind. We financed more than $600 million in SBA loans over the past 12 months and are ranked as the 14th largest SBA lender in the United States. Since our founding in October 1985, we have offered outstanding customer service and the best financial options for their needs. Today, First Bank of the Lake offers loans for business enterprises across the United States. To learn more about our bank or to apply for an SBA loan, visit our website or check us out on Facebook or LinkedIn. Our friendly and knowledgeable staff members will be happy to discuss your loan options with you and to help you achieve the highest degree of success in your chosen industry.

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