VA Business Loan Calculator
How to use our VA Business Loan Calculator?
Welcome to our VA Business Loan Calculator! We are positive – you too were unable to find a comprehensive calculator that would help you understand how much of a VA business loan could you actually get.
We too struggled to find one out and that is precisely why, we’ve built one for you exclusively after extensively researching the military ranks, the associated “Funding Fee” with each of the ranks and helping you get an estimated VA business loan amount right from your browser without needing to call the SBA Office (Small Business Administration).
So, with our VA Business Loan Calculator, you get to play around with numbers and carefully plan your next big move of owning a VA small business. While you were busy protecting us, the citizens of this nation, we wanted to contribute a bit by building something of value to you and your family, so whenever you want to calculate monthly payments, total interest and funding fee on your VA business loans, we are just a click away.
We are literally a one-stop solution to calculate all things VA. Follow the steps below to ascertain the VA Business Loan amount:
1. Input your Loan Amount, Interest Rate, and Term (years)
Step 1: Input Your Loan Details:
- Loan Amount: Enter the exact loan amount you’re considering in the “Loan Amount” field. This is the amount you plan to borrow for your business needs.
- Interest Rate (%): Specify the annual interest rate for your loan in the “Interest Rate (%)” field. This rate is represented as a percentage.
- Term (years): Define the loan term in years by providing the number of years you intend to repay the loan within the “Term (years)” field. This represents the duration of your loan.
2. Choose Your Military Rank
- Military Rank: Select your military rank from the dropdown menu labeled “Military Rank.” This choice is crucial for calculating the funding fee accurately.
3. Click "Calculate" and Review Results
- Calculate: Once you’ve entered your loan details and military rank, click the “Calculate” button. This action will initiate the calculation process. The VA Business Loan Calculator will then present the following essential results:
- Monthly Payment: This figure represents your estimated monthly loan payment, encompassing both principal and interest.
- Total Interest: The total interest cost for the entire loan term.
- Funding Fee: The funding fee amount based on your military rank and loan amount.
Re-Calculating Made Easy
For exploring different loan scenarios, simply update your loan details, select your military rank, and click “Calculate” again. The calculator provides instant, accurate estimates for your convenience.
How to Apply for a VA Business Loan?
After having served your nation, we know how eager you would now be to serve the people of this wonderful nation by starting a small business and to help you understand the process of applying for a VA Business Loan, we’ve outlined the steps below.
Also, if you’ve not already used the only calculator available on the internet that considers all the military ranks and accurately calculates the VA Small Business Loan Amount for you, click here to access it now.
A Comprehensive Guide on Applying for a VA Business Loan
Starting a small business with the help of a VA Business Loan can indeed be an exciting venture and to ensure you follow the right steps during this complicated financial process, we’ve compiled a comprehensive guide on “How to Apply for a VA Business Loan”, which should certainly ensure you get the business loan from VA as soon as possible, without any hiccups along the way.
So, if you’re a veteran or a spouse of a veteran looking to kickstart your entrepreneurial journey, a VA business loan can be an excellent option and must be considered before digging into your savings. Here are the steps for your quick reference:
- Step 1: Determine Your Eligibility
Eligibility Categories: You must fall into one of these categories – a veteran, service-disabled veteran, current or former spouse of a veteran, or widow or widower of a veteran who died in service or from a service-related disability.
Feasible Business Plan: While you may already have the plan etched on your mind to a tee, it’s important to be able to prepare a comprehensive business plan outlining your business goals, strategies, and financial projections.
A strong business plan is critical to demonstrate the feasibility of your venture and to help gauge the validity and credibility of your overall business endeavor. It can be as simple as a few powerpoint slides that encompasses your vision for the business, the execution strategies and the financial projections.
Good Credit: Not all of us have a good credit score and the SBA-lenders understand that, but as with all financial dealings, the lenders will assess your credit history to evaluate your financial standing, so it is paramount to maintain and demonstrate a good credit score.
Ability to Repay: While VA Business Loans do not require collateral necessarily, the loan-lenders will scrutinize your financial statements, income, and expenses to measure your ability to repay, so be ready to answer a bunch of questions about you and your family-related expenses.
- Step 2: Gather the Necessary Documentation
When applying for a VA business loan, prepare the following documents:
VA Form 26-1880: Fill out a VA Form 26-1880, Request for Certificate of Eligibility. This form is a must to verify your eligibility for the loan.
Proof of Military Service: Provide a copy of your DD Form 214 to establish your veteran status.
Business Plan: Include a copy of your business plan, which outlines your business concept, market analysis, financial projections, and more. As mentioned earlier, a simple PDF of a PowerPoint deck should work.
Financial Statements: Prepare detailed financial statements for your business and personal finances. These documents are required by SBA-lenders to assess your financial health, both business and personal.
Tax Returns: Not sure about you, but we, personally, hate to collate Tax Returns, but it is needed for further financial evaluation, so please be sure to furnish copies of your tax returns.
Collateral Information: This is case-specific and only if you are required to secure the loan with a predefined collateral, you may have to provide a list of those assets and their valuation.
- Step 3: Apply for the Loan
Now that you have a deeper understanding of how the process of applying for a VA Business Loans actually work, you can apply for a VA business loan directly through the Small Business Administration (SBA), which offers several loan programs tailored to veterans:
7(a) Loan: The SBA’s most popular loan program, the 7(a) loan, can be used for various business purposes, such as launching a new business, expanding an existing one, or acquiring equipment.
504 Loan: Designed for real estate or equipment purchases or improvements.
Microloan: Offers smaller loans to businesses that struggle to obtain financing from traditional lenders.
To initiate your application, complete an online application through an SBA-approved lender. The SBA will review your application and notify you if they need any additional documents and/or if the loan is approved.
Statistics (Source: Small Business Administration)
In 2022, the SBA approved over $36 billion in loans for veteran-owned businesses, accounting for over 20% of all SBA loans.
Additionally, a 2021 study conducted by the National Bureau of Economic Research found that veteran-owned businesses tend to exhibit better survival and growth rates compared to their non-veteran-owned counterparts.
- Additional Tips
Before applying for a VA business loan, remember these essential tips:
Develop a Robust Business Plan: Your business plan should be thorough, showcasing your goals, strategies, and financial projections.
Get Pre-Approved: Seek pre-approval for a loan before searching for business property or equipment. This helps determine your borrowing capacity and expected monthly payments.
Compare Lenders: Shop around and compare loan rates from different lenders. Getting pre-approved from multiple lenders is wise in case one denies your application.
Seek Assistance: Don’t hesitate to consult with experts like the Small Business Development Centers (SBDCs) or SCORE mentors for guidance in crafting your business plan and navigating the loan application process.
Maintain Good Credit: Let us re-emphasize the importance of good credit as it has always been one of the most crucial factors in deciding whether or not a VA Business Loan should be approved or not.
Legal and Financial Advice: Consider seeking legal or financial advice when dealing with complex loan terms and collateral agreements, as these obligations require a bigger commitment.
So, while concluding this topic, we will reiterate – while applying for a VA business loan sounds like a significant step toward realizing your entrepreneurial dreams, it is the right step and you are on the right track.
By adhering to the eligibility criteria, gathering the required documentation, and following our comprehensive guide, you’ll be well-prepared to secure the small business VA financing you need to launch or expand your veteran-owned business.
Remember, the resources and support are available, and your dedication as a veteran entrepreneur is both admirable and valuable to our nation’s business landscape. Good luck!
VA Business Loan Rates - October 2023
Here’s a snapshot of the latest VA Business Loan rates offered by some of the prominent lenders in the United States:
| Lender | Loan Amount | Rate | APR | Term | Fees |
|---|---|---|---|---|---|
|
Veterans Bank |
$5,000-$2 million |
6.13% |
6.43% |
5-30 years |
1.5% origination fee |
|
Navy Federal Credit Union |
$5,000-$1 million |
5.75% |
5.83% |
5-30 years |
1% origination fee |
|
USAA |
$5,000-$1 million |
6.00% |
6.12% |
5-30 years |
1.5% origination fee |
|
SBA 7(a) Loan |
$25,000-$5 million |
6.75%-10.50% |
7.00%-10.75% |
5-25 years |
2%-4% origination fee |
|
SBA 504 Loan |
$500,000-$10 million |
5.50%-7.50% |
5.75%-7.75% |
10-25 years |
2%-4% origination fee |
Please note, this is just a glimpse into the offerings; numerous other lenders provide VA Business Loans tailored to your needs. Shopping around and comparing rates from multiple lenders is essential before committing to a loan.
Beyond the Rates: What You Need to Know
1. Fees Matter
Interest rates are just one part of the equation. When comparing VA Business Loan rates, consider additional fees such as origination fees, appraisal fees, and closing costs. Understanding the comprehensive financial picture will help you make an informed choice.
2. Terms Define Your Commitment
The terms of VA Business Loans range from 5 to 30 years. While longer terms translate to lower monthly payments, they also mean paying more interest over the loan’s life. Balance your monthly budget with your long-term financial goals when choosing the loan term.
3. Requirements and Eligibility
Before you set your heart on a loan, ensure you meet the lender’s eligibility criteria. Common prerequisites include a minimum credit score and a well-thought-out business plan. Knowing these requirements beforehand saves you time and energy.
Conclusion: Empowering Your Business Journey
Securing a VA Business Loan is not just a financial decision; it’s a strategic move toward realizing your entrepreneurial dreams. Armed with the latest rates and essential insights, you’re now better equipped to navigate the intricate world of business financing. As you venture into the realm of possibilities, remember that knowledge, coupled with prudence, is your most potent tool.
Should you have any more questions or need further assistance, please don’t hesitate to reach out. Here’s to your business success – may your dreams soar high and your ventures prosper!