Diversity 1

Small Business Administration Loans

The Small Business Administration (SBA) program was designed to assist small businesses that may not otherwise qualify for credit under conventional loan programs. Compared to conventional financing, SBA loans may provide longer or more flexible terms, fixed and variable interest rates, higher loan-to-value ratios and reduced cash injection. SBA loans can help small businesses purchase or renovate real estate, acquire fixed assets such as heavy machinery or specialized equipment, finance start-up business operations, finance business acquisitions, refinance existing debt under certain circumstances or supply working capital for ongoing financing needs.

Silvergate Bank is an approved SBA lender that provides both
SBA 7(a) and SBA 504 guaranteed financing to businesses who meet the SBA’s requirements:

Owner-operated and occupied
For profit
Organized as a sole proprietorship, corporation, or professional partnership
Within the size guidelines designated by the SBA
Unable to secure other credit under reasonable terms

Silvergate Bank offers the following terms for all SBA 7(a) and
SBA 504 financing:

SBA 7(a)

Credit Amount	Term Loans up to $5,000,000
Terms	Working Capital: 7 years to 10 years depending on repayment ability Equipment and Inventory: up to 10 years (or useful life) Real Estate: up to 25 years Business Acquisitions and Start-ups: up to 10 years
Interest Rates	Variable - WSJ Prime + 2.25% to 2.75%
Fees	SBA Guarantee Fees: 2% to 3.75% depending on loan size of the SBA gauranteed portion.
Underwriting Requirements	Personal guarantees by all owners of 20% or more Adequate business collateral, or personal assets securing personal guarantee Management capability Ability to demonstrate repayment (adequate cash flow)

SBA 504

Credit Amount	Total project amount up to a maximum of $10,000,000 Debenture amount (SBA portion 100% guaranteed) up to $5,000,000 or up to $5,500,000 if business is defined as a small manufacturer
Terms	Real Estate: up to 25 years (20 years on debenture amount)
Interest Rates	Silvergate Bank Loan: Fixed or variable — negotiated rate between borrower and bank SBA Loan: Below market fixed interest payment; loan rate set when debenture is sold
Fees	Generally 3.5% of SBA debenture amount, which may be financed into the loan
Underwriting Requirements	Personal guarantees by all owners of 20% or more Adequate business collateral on assets being financed Management capability Ability to demonstrate repayment (adequate cash flow)