SBA Community Advantage Loan

SBA Community Advantage (CA) loans are aimed at helping underrepresented business owners. This includes communities of veterans and finance businesses in underserved communities. The SBA provides Community Advantage loans via lenders who have a reputation for helping these communities. This is done to ensure that the right market can make use of these facilities. Community Advantage loans aim at people who are not capable of getting traditional loans—it is easier to qualify for this service instead, and they are also competitively priced. The maximum prime rate is + 6%.

Disadvantages of CA Loans

One of the biggest downsides of a CA loan is its small size in comparison to other SBA loans. The highest amount you can access under one is $250,000. SBA loan requirements herein include the borrower showing they come from a community which is underserved. Although that drawback exists, this is still one of the best options available for business owners who have been turned down for similarly sized loans. The CA loans are allowed for a term of between 7 and 10 years for tenant improvements, business acquisitions, inventory, start-up expenses, and working capital. The repayment term is 25 years for real estate businesses.

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