Can you apply for an SBA loan twice?

In short, generally, yes. If you continue to meet the minimum requirements for your current SBA loan, lenders typically should have no problem approving you for another. Your business will need to be profitable with a good credit score. The amount of funding you ask for also likely needs to be within the loan program’s borrowing limits.

Additionally, when applying for a second SBA loan, your first must be in good standing. Your first loan application went through because the lender judged that you could reliably repay the loan. If that proved to be untrue, they’d likely hesitate to give you more funding.

Example of having multiple SBA loans

You can have multiple SBA loans with funding totals up to each program’s borrowing limits. For example, SBA 7(a) loans from a bank in the SmartBiz® network have a limit of $350,000. If you borrow $150,000 with an SBA 7(a) loan, you can typically still borrow up to another $200,000. Additionally, you can generally receive $350,000 from an SBA 7(a) loan and still get an additional $100,000 from a non-SBA loan.

Pros and cons of having multiple SBA loans

Multiple SBA loans may be beneficial for your business, but since loans are debts, there’s generally some risk involved. Before committing to another small business loan, you will likely want to consider all the possible advantages and disadvantages.

The pros of multiple SBA loans

Some reasons you might benefit from multiple SBA loans include:

• Large loan amounts . SBA loans offer small business owners some of the largest loan amounts possible. You can generally secure up to $350,000 with an SBA 7(a) loan from a bank in the SmartBiz network.
• Best rates and terms for a loan . Another notable benefit of SBA loans is their low interest rates and long repayment periods. Ten-year terms for an SBA loan breaks down into digestible monthly payments. You’ll typically have less risk of defaulting on an SBA loan, and that may help you keep your financial record healthy.

The cons of multiple SBA loans

Some reasons why you might think twice about taking out more than one SBA loan include:

• Lengthy application processes . Signing up for a second SBA loan doesn’t necessarily speed up or simplify these loans’ application process, which can be lengthy. Lenders will typically still go through their usual checks to determine whether you’re eligible, even if you qualified in the past.
• Personal risk . SBA loans typically do not require collateral, but a lien on business assets is required. Generally, when a lender files a lien against a business, they're granted a legal right to ownership over the borrower's personal or business assets in case of default. Multiple SBA loans can often mean more risk.