What is a Property Appraisal?

A property appraisal is a professional-based opinion that is offered in an unbiased manner regarding the value of the structure and associated property. These are regularly utilized in transactions involving homes and those that transactions that pertain to refinancing. The value may be used in the following instances:

1. Determining the worth of the home for the purpose and intent of establishing a price for selling the home
2. Performed by a lender to protect their interests in loaning money as the home is typically used as a form of collateral
3. Lenders typically require an appraisal during the refinancing of the property so that the amount of the new mortgage may be justified
4. Appraisals are done for the purpose of providing a home equity loan to a borrower to ensure that the value has increased and that there is true equity to back up providing the loan
5. Property appraisals may be done so that a homeowner may take out another type of loan – such as a business loan – so that the lender knows that the collateral is worth the risk
6. Many homeowners have a property appraisal done so that they may appeal the costs associated with their property taxes
7. A property appraisal is typically done on homes for sale so that the potential buyer knows its true value and is able to negotiate the price of the property
8. An appraisal may be done by parties that have an interest in the estate – such as those that are going through a divorce or those that are beneficiaries to a loved one’s estate for the purpose and intent of determining value so that the proper percentages of the proceeds from a sale may be split among all
9. If there is damage as a result of defects involving the construction of the property, an appraisal is done to assist in filing insurance claims and pursuing legal action
10. Property appraisals are commonly performed when a person files for bankruptcy as the homeowner will need to provide documentation that pertains to their assets

Why is a Property Appraisal Important in Real Estate Transactions?

Property appraisals are a necessary component and factor in the buying and selling of real estate. There are many reasons for this. The main ones being that lenders will not provide loans if the value of a home is less than the amount of loan that is requested. Additionally, an appraisal helps in determining the worth of the home.

What Does an Appraisal Tell About the Property Assessed?

A property appraisal provides a third-party, unbiased opinion of just how much the property is worth based on the fair market value. In short, it tells about the overall condition of the home, highlights repairs that may be necessary, and how the property stands up or compares against other nearby homes that have recently been sold.

Is a Property Appraisal and an Inspection the Same Thing?

A property appraisal and a home inspection both evaluate the condition of the home and offer a conclusive report; however, they are two different things and serve different types of purposes in the process of a real estate transaction. The property appraisal professional will make a judgment about the value of the home, but the inspection involves a comprehensive look at the general condition of the structure. Appraisals simply provide an outline of the valuation of the said structure based on the current guidelines and fair market value. A home inspection will zoom in all components of that home – such as the various systems and conditions of each.

What Does a Property Appraiser Look For?

Generally speaking, those that work as property appraisers will at various factors to determine the fairest market value of the structure. Fannie Mae has a publication called the Uniform Residential Appraisal Report that most professionals utilize to conduct their appraisal. It outlines both the inside and outside condition of the home and is dependent upon a list of homes near the home being evaluated that are similar in size and location that have actually been sold. The goal is to ensure that the value that is established is in direct line with all current trends and prices in the real estate market.

The Home Appraisal Report

All property appraisal reports vary from one area to another; however, those in a general location – such as a specific county – are typically similar to one another. The sections that are included in the report may include any of the following:

• The address of the home and the purpose of the appraisal – be it to sell, buy, refinance, or obtain another type of loan
• The parcel number and is there are any fees pertaining to a governing homeowner’s association where the home is located
• Details involving the purchase contract (if relevant)
• Characteristics of the neighborhood where the property is located, including any and all price or market trends related to that particular area
• The size of the property and the type of home on that property, including any additional buildings and attachments
• The condition and the features of the home that is being appraised
• Information about the homes in the neighborhood where the property is located and how much those properties have sold for recently
• The type of utilities that are present with the property

How Much Does a Property Appraisal Cost?

Property appraisals are typically required by a lender, but a borrower is required to pay for the evaluation. At the minimum, the appraisal will start at $200; however, they are typically higher than this. This is a low-end estimate. Despite the costs, an appraisal is a very valuable tool that could impact your finances in a positive way. Not only does it help in coming up with a price you can sell your home for, it also comes up with a value of a loan that you may take out. In addition to this, it may have a direct impact on whether you have a high interest rate or a low-interest rate on any loan for which you are approved.

Receiving the Appraisal

Once you receive your copy of the appraisal be certain to review it completely. If you feel it is not valued appropriately, you may encourage a lender to reassess a valuation. This is typically done if the report contains errors, leaves out specific information, or contains any biased type of information. If you request this, ensure that you provide complete and factual information that addresses your issues with the valuation.

Contact Us Today

If you are interested in a home equity loan, refinancing, or other types of loans, a property appraisal may help you with the approval process! If you would like to learn more about this, please contact one of our finance specialists today by visiting one of our many locations at Somerville Bank today.

The post What is a Property Appraisal and Why is it Important? appeared first on Somerville Bank.

What is a Property Appraisal?

A property appraisal is a process or an intentional act of developing and/or establishing an opinion regarding the value of a specific property. It involves the use of a valuation process. This is a systematic-based approach and procedure that a designated appraiser utilizes to answer questions and expound upon said property and its value.

Why is a Property Appraisal Done?

In most instances, a property appraisal is done when one is purchasing a new home, selling a home, or has a desire to refinance on an existing loan on a home.

A lender will use this appraisal in order to determine the value of the property being examined. Once the property appraisal is completed, certain factors may be determined.

These include the amount that is required for a down payment, whether or not a potential buyer will be approved for a loan on the property, and even the interest rate associated with a loan on the property.

How Does a Property Appraisal Work?

If you require the services of a lender for a property, you will need a property appraisal to determine its value. This is done because it will outline the amount of collateral that will go against the loan. It does not matter if you are making a new purchase, you want to refinance your current loan, or you are in the market for a home equity loan, an appraisal will be necessary.

Once the lender orders the appraisal, you will usually be required to pay for it as this is commonplace in the financing aspect.

Once done, the lender will establish the relation between the market value of the property and the loan that you have an interest in obtaining. You will be provided with a copy of the appraisal. You should then review the information on the appraisal.

If you find inaccuracies, you may request a reassessment. This may be requested of the individual that conducted the assessment and the lender that you want to work with.

If you experience further complications, you may file an official complaint with the Consumer Financial Protection Bureau. Additionally, the FDIC may be contacted at the following number: 877-275-3342.

How Can Appraisals Be Used?

There are many unique ways in which a property appraisal may be used. These include – but are not limited to – the following:

• To aid in the facilitation of the transfer of the ownership of the said property
• To assist sellers in determining how much a property may be sold for and to outline offering prices
• To create a unique basis for the merging, reorganization, or exchange of a property or multiple properties
• To help an underwriter determine the value associated with the security of a loan for a mortgage
• To assist an investor with a basis for purchasing a mortgage, a bond, or another type of a security
• To determine the market value of said property for the purpose and intent of any associated proceedings in regards to the domain
• To provide an estimate of the property value for the purpose and intent of clarifying contract disputes and/or as a part of a portfolio
• To get an estimate of the property’s market value due to the interests associated with a partnership
• To outline the damages that have occurred as a result of environmental-based contamination
• To give an outline of the estimate of the value of the property that has been assessed
• To specify the amount of taxes due if a property is considered to be a gift or an inheritance
• To determine value on a property that is part of an estate
• To outline the amount that should be charge for renting or leasing the property
• To gather information as to whether or not a construction program or a renovation program is needed and may complete projects on said property
• To make a revision to the book value of a property, to determine the issuance associated with a stock, and/or for the purpose and intent of satisfying the interests of corporate-based mergers
• If a forced-sale is going to occur or an auction is going to happen a property appraisal will outline the liquidation value of said property
• An appraisal may be done for the purpose and intent of client counseling on matters regarding investments – such as resources
• It may be done to advise interested parties of pending auctions – such as zoning boards and the local court
• Finally, a property appraisal may be performed to conduct an arbitration between any type of adversaries

What Influences the Value of Property Appraisals?

There are several influences that have a direct impact on how much value a property is appraised for. These include social influences, governmental influences, environmental factors, and economic influences. In addition to this, the nature of the real estate market, supply and demand, and other external factors play a role in developing a fair market value. Value is commonly viewed as follows:

1. The cost it would take to replace or reproduce a property after deducting the amount for depreciation and the value of any land associated with the property.
2. The value of properties that have been recently sold and are comparable to the said property.
3. The value that outlines the net earning potential of the property.

How is Comparable Value Determined in Property Appraisals?

There are many elements that an appraiser takes into consideration when determining comparable value. These include the following:

• The Property Rights
• The Terms Associated with Financing
• The Conditions Surrounding the Sale
• Any Expenditures Associated with the Property
• The Market Conditions
• The Location of the Property
• The Characteristics Associated with the Property
• The Economic Components of the Property
• The Way the Property is Zoned and How it Will be Used
• Non-Realty-Based Components

How to Find a Property Appraiser

If you are in need of a property appraiser, you must be cautious in your selection. It is best to go online to the Appraisal Institute in order to select one. This is a specially-designed online directory that lists professionals throughout the United States and in other locations throughout the world. In addition, you may obtain information about special programs, resource publications, numerous services, and even benefits associated with the property appraisal process.

Contact Us Today

If you are in search of funding for a property, contact us today at Somerville Bank. We offer home loans, mortgages, home equity loans, refinancing, and more. In addition to this, we have a professional partnership with many different property appraisers in and around the area. We can truly take the challenge out of determining the value of your property for the purpose and intent of selling, buying, refinancing, or determining the value of the property as collateral. Give us a call, or visit one of the many branches that our bank has today. If you need a loan, we have the resources to assist you!

The post The Property Appraisal – A Comprehensive Guide for Consumers appeared first on Somerville Bank.

Prior to Shopping for Your First Home

Did you know that applying for a mortgage actually starts prior to your shopping for your home? Most people don’t, but it is true. You will need to outline what you are able to afford, learn the basics of home buying, and learn how to evaluate your overall level of financial readiness.

You may also contact one of our specialists here at Somerville Bank. We can provide you with the educational basics and the tools regarding financial literacy that will help you get a jump on the application process and that of becoming an actual homeowner.

Meet with a Loan Officer

Once you have reviewed the basics with our specialists here at Somerville Bank, you should consult with one of our many loan officers. This professional will help in the review process as it relates to your income and your expenses.

They will be able to pinpoint which types of mortgage loans that you qualify for and the overall amounts that are available to you. Our specialists will provide you with a number of tips and techniques that will help connect you to the soundest options for your needs.

Examples of these include – but are not at all limited to – the following:

1. It is imperative to avoid companies that provide you a mortgage and state that the interest rate will not be affected by credit problems. The truth is, your credit does impact what you qualify for, what you pay in interest, and the overall term of your loan.
2. You should avoid accepting mortgage loan offers that have prepayment penalties in place. In short, this means that if you want to pay off the loan early, you will be required to pay an additional fee for not paying according to the terms of the loan.
3. When searching for a mortgage loan, it is important to avoid working with professionals that will attempt to falsify information to ensure that you qualify. You should avoid falsification at all costs and never sign any document that contains information that you know is considered to be false.
4. When applying for a mortgage loan for the first time, you should always learn as much as possible about all of the fees associated with that loan. Before committing through a signature, a loan officer should go over all aspects of the paperwork with you. If you find that you do not understand something, do not sign. Instead, ask more questions for clarification. Once you are in full understanding, you may then sign the paperwork if you agree to the terms of the mortgage loan.
5. If a credit issue is holding you back from obtaining your first mortgage loan, do not work with credit counseling or credit consolidation agencies that are fraudulent. It is acceptable to work with credit counselors that are considered to be legitimate and offer legitimate services. If you are in need of a credit counselor, please inquire with us here at Somerville Bank. We can provide you with tools and resources that will be highly beneficial to your needs – that are legitimate.

What is the Mortgage Lender?

The mortgage loan lender is the financial institution that is responsible for providing the funds for the loan that you obtain. If you were to obtain your loan with us here at Somerville Bank – for example – we would be considered the mortgage lender.

The lender has the responsibility of collecting the payments associated with your loan. If you require more information on this topic, please stop by one of our many locations for immediate assistance.

Discovering a Mortgage Loan That is Right for You

Once you start the process of looking for a mortgage loan, you will find that you have seemingly endless options. The goal is to find a loan that is right for you, your finances, and your unique situation. It all goes down to three components that you should be especially considerate of:

1. Type – There are fixed rate loans, adjustable-rate loans, conventional loans, insured loans, and government-guaranteed loans. You should narrow your search down by learning about all of the different types of loans and choosing the one that closely matches what you are looking for in a mortgage loan.
2. Rate – Will you choose a fixed rate loan, an adjustable-rate mortgage, will you pay higher interest with a lower down payment or less interest with a higher down payment? You should research each of these options and determine which sounds the best for you.
3. Loan Estimate – When reviewing mortgage loans, always evaluate all of the components of the estimate that you are provided. This includes the summary of the terms of the loan, the actual amount of the loan, the closing costs, and all other associated fees.

Contact Us Today

We here at Somerville Bank have assisted thousands upon thousands of people in getting their first mortgage loan to purchase their dream home. We continue to offer our services to those in and around the communities in which we operate. If you need assistance with the information contained in this guide, any aspect of the mortgage loan process, or would like to make an appointment, visit us now at one of our many locations.

The post How to Apply for Your First Mortgage Loan appeared first on Somerville Bank.

While buying your first home is an important milestone, it is also a challenging endeavor that can prove to be quite overwhelming. Not only do you have to shop around for the perfect structure for you and your family, but you will also need to obtain funding through the means of a mortgage in order to make the purchase.

A home is the single largest investment that you will make in your lifetime. As a result of this fact, it is imperative that you take a few essential steps to help you through the process. In this brief guide, you will be introduced to 4 of these.

Step #1: Saving for the Purchase

As you likely already know, lenders will require a down payment on the home that you elect to purchase. You should start saving money prior to even shopping for your home.

This is best done by automating the process.

In other words, you should have a certain percentage of your income direct deposited into a special savings account. You should avoid spending any money out of that account for anything else other than your home.

In addition to saving for the down payment, you should save for the closing costs associated with the purchase of the home.

While saving your money, look into programs that are designed to help with down payments and associated expenses. This could help you get ahead on your first payment when it comes due.

Step #2: Ensure You Have a High Credit Score

The next step to preparing for the purchase of your home is to get your credit score as high as you are able to.

Getting approved for a loan will be heavily dependent on your score.

To increase the score, make sure you make all payments on any credit cards, loans, and utilities on time, avoid maxing out credit resources, pay off accounts and keep them open to ensure that you have a longer length on your credit accounts, and make use of various types of credit accounts.

By taking these steps, you can quickly boost your credit score.

Step #3: Gather Important Documents

When preparing to apply for a home loan, there are many documents that you should gather. These include pay stubs, tax returns, your bank statements (approximately six to twelve months’ worth), and other types of financial information.

Step #4: Determine What You Can Afford

When seeking a home loan, you should determine just how much you can afford to spend.

Simply start by figuring out your debt-to-income ratio; that is, the amount of your income that is spent on debt payments each month, prior to any type of deduction.

It is best to avoid exceeding 40% of the gross income that you make each month.

We Can Help

Are you ready to purchase a home? Do you need a home loan? Would you like a little help with the process?

If you answered “yes” to any of these questions, contact us here at Somerville Bank for assistance by visiting one of our many locations: https://somervillebank.net/locations/

The post 4 Steps to Take Before Buying Your First Home appeared first on Somerville Bank.

may be obtained from either a bank or a private lender. Somerville Bank offers commercial loans to business owners that require money to supply their working capital, pay for the operation of their business, and/or cover other types of expenses associated with their business.

There are many types of commercial loans.

Each type has its own eligibility requirements, specific interest rates, and terms associated with repayment.

Types of Commercial Loans

Before applying for a commercial loan, it is important to know the types that are available to you. They are as follows:

1. The Traditional Term Loan This is provided as a lump sum cash amount. You will be required to pay back the money provided, as well as the interest specified by the bank, over a set period of time. Most business owners opt for these loans when they have a relatively large expense associated with their business.
2. The Short-Term Loan  Business owners that have a small, one-time expense associated with their business may benefit from this type of loan. The amount borrowed may be as little as $10,000 or as much as $500,000. It is paid back with interest with daily or weekly payments in as little as 3 months or as much as 18 months.
3. The SBA Loan This long-term loan is offered by the Small Business Administration. It has low-interest rates that are backed by the government. It is ideal for business owners that are seeking to cover recurring expenses or a one-time expense.
4. The Equipment Loan If a business owner needs to purchase equipment, this is the type of loan commonly pursued. The equipment will serve as the collateral on the loan.
5. The Commercial Real Estate Loan  This type of loan is for business owners that want to either buy properties or upgrade currently possessed properties. The property serves as the collateral on the loan.
6. The Line of Credit  This is a revolving line of credit that provides access to cash to a business owner. That business owner may then take out the amount of money that they need when they need it. Interest is paid only on the amount drawn. As money is paid back, it is then added to the available credit line. This type of loan is much like that of a credit card. It is ideal for the business owner that has various expenses or irregularities in their cash flow.
7. The Merchant Advance  This is a lump sum of money that is repaid with a certain percentage of credit card transactions within the business each day. This is considered to be one of the most expensive of all commercial loan options and should only be utilized by those who are unable to obtain other types of financing.

If you have an interest in taking out a commercial loan, contact us today at: https://somervillebank.net/contacts/

Resources:

https://www.investopedia.com/terms/c/commercial-loan.asp

https://www.ondeck.com/resources/commercial-loans-small-business

http://www.c-loans.com/borrowers-investors/will-i-qualify-for-a-commercial-loan

The post Types of Commercial Loans appeared first on Somerville Bank.

These areas may include operational costs, purchasing of much-needed equipment, payroll, or to obtain items that are necessary for the processes of production and manufacturing.

While obtaining this type of loan is – for the most part – a financial transaction between you and the bank that you elect to use, it is also the formation and development of a long-term relationship between you (the borrower) and the financial institution (the lender).

The bank that you choose to work with is directly responsible for making decisions that are considered to be consistent with the parameters and the limitations of their business. As a result of this fact, banks will test each commercial loan applicant against five basic lending criteria. These are referred to as the “5 Cs of Credit”. In this brief post, you will learn about the 5 Cs of credit.

1. Capacity

The first of the 5 Cs of credit is “Capacity”. In essence, this is your ability to successfully repay the loan that you are requesting. One of the best methods for establishing your capacity to repay the loan is to present a business plan and all cash statements associated with your business. The financial institution that you are applying to will want to see exactly how the capital repayments and the interest are going to be paid over the entire term of the loan.

2. Capital

The second of the 5 Cs of credit is “Capital”. Basically, this is the value of the net worth of your company. This is where you will need to present your personal net worth. This will allow the bank to see your commitment to the overall proposal.

3. Collateral

“Collateral” is the third component of the 5 Cs of credit. This will show your ability to provide a guarantee to the loan and your company’s ability to convert the assets into cash within a small time frame.

4. Credit History

“Credit Hitory” is the fourth component to the 5 Cs of credit. This provides a quick glance at how you and your business have handled financial issues and dealings in the past.

5. Character

The fifth and final component of the 5 Cs of credit is “Character”. It is essential that the bank be able to establish that you demonstrate integrity and a high level of trustworthiness.

Business lending is rather subjective, in nature. The 5 Cs of credit are considered to be quantifiable elements that are evaluated by a lender. In addition to these 5 criteria, many loans may be made based on the comfort level that has been forged between you, your business, and your bank.

The post Banks Evaluate the 5 Cs of Credit Before Approving Commercial Loans appeared first on Somerville Bank.

The FHA loan requirements state that those who have a favorable credit history with a long track of timely payments on their debts will be eligible for the loan that they have applied; however, those that have a credit history that displays poor financial choices, slow payments, and accounts that are delinquent are not considered to be proper candidates for the FHA loan.

If you are an applicant that has a few blemishes on your credit and have an interest in a FHA loan, it is important that you continue reading. Here, you will learn about the common credit guidelines that FHA lenders will use to approve or disapprove your loan.

Common FHA Credit Guidelines That Lenders Use to Approve a Loan

No Credit History, Whatsoever

In order to apply for a FHA loan, it is essential to have two lines of credit. If, for some reason, you do not have the sufficient amount of credit on your report, you will be pleased to know that the FHA does allow substitutions.

You will need to talk to an agent at Somerville National Bank to learn more about the approved substitutions.

Chapter 13

If you have filed a Chapter 13 Bankruptcy, you will be pleased to know that you could – potentially – be approved for a FHA loan. It must be established that you have been making satisfactory payments for at least a year, straight.

You will also likely require a written approval from a court trustee to obtain the loan. Furthermore, job stability, the re-establishment of good credit, and a detailed explanation of the previous bankruptcy may be required.

Chapter 7

If you have a Chapter 7 Bankruptcy in your history, you may still be approved for a FHA loan. According to the information on the FHA guidelines, a period of at least two years must have passed from the discharge date of the event. Job stability, the re-establishment of good credit, financial qualification, and an explanation of the event will likely be required.

Collections, Judgments, and Debts

The FHA considers a collection to be minor. It does not have to be paid in order to obtain approval for a FHA loan; however, judgments will need to be paid completely.

If you have a federal debt such as a tax lien or a student loan, you may be approved; however, if you are delinquent on federal debts, you will not be eligible to obtain a FHA loan.

Foreclosure

In most instances, you will not be approved for a FHA loan if you had a foreclosure in the past three years; however, if the foreclosure was due to extenuating circumstances, you may qualify for an exception to be granted. That is, if you have re-established good credit since the event.

Late Payments

When applying for a FHA loan, the lender will analyze the pattern associated with your credit behavior. If you have had late payments, they could result in being disqualified; however, if you have established a good payment history since the late payments, you may be able to get approval for a FHA loan.

The post Common FHA Credit Guidelines appeared first on Somerville Bank.

It is important that you realize this – right at the beginning of the endeavor – especially if you are a first-time homebuyer. There are many considerations that must be made in order to determine if a particular mortgage is right for you.

In this brief guide, you will learn three basic questions that should be asked to ensure that you are in the process of deciding which mortgage is most appropriate for your situation.

Question #1: Is a Fixed Rate Mortgage or an Adjustable Rate Mortgage the Best Option?

When shopping for a mortgage, you will be presented with two options: fixed rate and adjustable rate. It is imperative that you learn about each so that you are able to determine which is best for your individual needs. A fixed rate mortgage is a type of mortgage that locks you in on a consistent interest rate that will be paid over the entire lifetime of the loan. The adjustable rate mortgage has an interest rate that fluctuates up and down over the entire life of the loan.

This type of mortgage typically starts with an introductory period of 1 to 10 years that the interest rate remains the same; however, following this time period, the interest rate will change – based on the index chosen by the bank in which you have obtained the mortgage.

While the adjustable rate mortgage often seems ideal because of a lower introductory rate, it is important to remember that this rate is sure to change immediately following the introductory period.

Question #2: How Much Will Need to be Paid in Closing Costs?

In most instances, closing costs will end up equally approximately 3% of the total purchase price of a home. Once the finalization of the home has occurred, you will be required to pay the costs. These costs include lending fees, processing fees, appraisal fees, insurance fees, and fees that are similar in nature.

In order to reduce the amount of the closing costs, it is imperative that you shop around to determine which lender has the lowest amount of fees on the process.

Question #3: How Much Should Be Put Down on a Home?

It is a known fact that a low down payment results in a higher interest rate on a mortgage. In order to avoid high interest rates, it is advised that – at least – 20% of the total purchase price is placed down on the home. If that is difficult, there is typically an option of 5%.

You must be aware of the fact that, if you put a low amount down on a home, you will probably be required to purchase private mortgage insurance. This will result in higher expenses.

The post Determining if a Home Mortgage is Right for You appeared first on Somerville Bank.

Optimal Business Success
Small businesses that elect to obtain SBA loans are said to have the edge when it comes to optimal business success. According to statistics, two out of every three businesses that obtain a SBA loan are capable of establishing a business that has a high level of revenue. Three out of every four are able to successfully hire within their business. Nearly half are able to successfully obtain government-based contracts. Businesses that obtain their funding through SBA loans are said to have a higher level of sophistication when it comes to operations. Furthermore, these businesses are able to tackle and overcome business-related complications and challenges more quickly than businesses that do not obtain a SBA loan.

Reach New Heights
SBA loans will help your business reach new heights – in production and profits. Studies have established that most jobs that have been created in our economy stem from appropriate lending to small businesses – especially those that have received SBA loans. This is because when businesses obtain lending from the Small Business Administration, they receive more than just money. They also receive counseling on how to be successful in their endeavors and they are provided with the various contracts and the necessary capital required to expand. If you have a small business idea, but, do not have the funding to follow through on that idea, it is important that you consider obtaining a loan from the Small Business Administration.

Somerville National Bank
Here at Somerville Bank, we believe in funding the small business. Our professional lending team will take every route possible to ensure that YOUR business ends up on the road to success. We know that a great deal of the success that you will experience will depend heavily on your journey, not just your final destination. By working with us, we will commit to ensuring that every opportunity you qualify for with the Small Business Administration works to the greater good for your business. We are more than just a bank. We are a part of the community where your business will operate!

The post SBA Loans – Part 1 appeared first on Somerville Bank.

SBA Loans – At a Glance
SBA Loans are provided by the Small Business Administration, which is a federal agency whose purpose and intent is to aid entrepreneurs to start their businesses, improve their businesses, and gain access to contracting opportunities that will aid with a business. Many mistakenly believe that the Small Business Administration actually lends the loans to the businesses that seek the funds; however, this is not true. The federal agency provides the funds to a bank and other type of lending institution. Financial institutions are the ones that are backed by the incentives that make it possible to provide funding to small businesses.

Obtaining a SBA Loan
In some instances, it is easy to obtain a SBA Loan. In other instances, it may prove to be a long and tedious process. Often, there will be strict credit criteria associated with obtaining a SBA Loan; however, many banks and other types of financial institutions may forego the strict requirements for the purpose and intent of assisting the applicant. It is common, though, for lenders to want to review your credit, financial statements, and determine if you have collateral. The loan application process is going to be quite extensive. Not only will you be required to provide comprehensive financial information, but, you will also have to provide a description of the business that you have, information on how you will use the loan that you are desiring to obtain, a business plan, and a detailed outline of what steps you will be required to take in order to successfully repay the loan.

Conclusion
Thank you for reading Part 1 of our series, “SBA Loans – A Comprehensive Guide for Somerville National Bank’s Current and Future Clients”. Here, you have learned what SBA Loans are and what it takes to obtain such a loan. You have also learned that while these loans are from the federal Small Business Administration, they are typically obtained from a bank or similar type of financial institution. Remember to bookmark us and visit next week as we continue this series. For more information on what Somerville National Bank has to offer, visit us today at: http://somervillebank.net/

The post SBA Loans – A Comprehensive Guide for Somerville National Bank’s Current and Future Clients (Part 1) appeared first on Somerville Bank.