If you’re a small business owner thinking about applying for a loan, first off — great! That means you’re growing, planning, and investing in your business. I’ve worked with a lot of small business owners over the years, and I want to share a few things that can help you be more prepared and confident walking into that first meeting with your bank.
Whether you're buying equipment, refinancing debt, or launching something new, here's what to know before you seek financing and how a Small Business Administration (SBA) loan comes into play.
Start with the why.
The first thing I want to understand when I meet with a business owner is the purpose of the loan. Why are we sitting down together? What do you want to accomplish? Are you buying out a partner, making leasehold improvements, or trying to level up your operations?
Being able to clearly explain your “why” is more important than you think. I want to hear your story — how long you’ve been in business, how you’ve weathered tough times, and where you want to go next. It gives me a sense of who you are and what kind of opportunity this is.
Know what you have (and what you need).
Lenders look at two big things: collateral and cash flow.
Depending on your industry, you might have different types of collateral. Here’s a quick cheat sheet:
- Inventory.
- Accounts receivable.
- Used equipment.
- Furniture and fixtures.
- Leasehold improvements.
If your business doesn’t have much collateral — or if it’s a startup — that’s when we might start talking about an SBA loan.
And yes — SBA loans can be a bit complex. But that’s where working with a preferred lender comes in.
What it means to be an SBA preferred lender.
Washington Trust is proud to be an SBA preferred lender. That means the SBA has vetted us and trusts our underwriting process. So when you come to us for an SBA loan, we handle everything in-house — eligibility review, packaging, documentation. We submit a clean, complete package directly to the SBA for approval.
The benefit for you? Speed. Simplicity. Less red tape.
Avoid the common mistakes.
One of the most common mistakes I see is a lack of understanding about total project cost. Whether you’re building out a new space or buying equipment, you need to know the full cost — not just what you hope to borrow.
If you forget a $50,000 expense halfway through the process, it creates problems. We want you to succeed, and that means getting it right the first time.
Another tip: if you're pursuing an SBA loan, have these three things ready:
- A detailed business plan.
- Realistic, well-supported financial projections.
- A clear, compelling narrative of your business.
These aren't just “nice to haves” — they’re essential for SBA applications.
You don’t have to go it alone.
If you're not sure how to pull it all together, there are some great organizations that can provide support.
- Small Business Development Center (SBDC). They’re incredible partners, and their services are often free. They’ll help you create a solid business plan, run realistic projections, and walk through your strategy. Find an SBDC near you.
- SCORE. A resource partner of the SBA, SCORE is non-profit that provides mentorship, workshops, and resources to help you start, grow, or successfully exit a business. Find a location in your area on SCORE’s website by entering your zip code.
- Chambers of Commerce / Economic Development Organizations (EDO). Most local chambers and/or EDOs have some sort of small business support department. It may be workshops and templates, counseling, or entrepreneurship-specific guidance. Regardless, it’s worth connecting with them to see what’s available regarding your needs.
Take the next step.
Getting a loan doesn’t have to be overwhelming. Start with a clear purpose, understand what you bring to the table in terms of collateral and cash flow, and lean on SBA resources if you need them. And if you're pursuing an SBA loan, choose a lender that knows the ropes and can move quickly — like an SBA preferred lender.
If you’re ready to take the next step or just want to explore your options, the Washington Trust Small Business Banking Team is available to talk through it with you. Our job isn’t just about approving loans — it’s about helping business owners grow the right way.
