What is Preferred Lender Program (PLP)?
The Short Answer
Preferred Lender Program (PLP) explained simply
The Preferred Lender Program (PLP) is a partnership between the Small Business Administration (SBA) and certain financial institutions. These lenders have a proven track record with SBA loans. Because of their experience, the SBA gives them the authority to make final credit decisions on SBA-guaranteed loans without needing the SBA to review each one. This means a faster approval process for small businesses looking for funding, as the lender can approve the loan directly.
Real-World Example
Getting a PLP Loan for Your Business
Imagine you own a small manufacturing business and need a loan to buy new equipment. You apply for an SBA 7(a) loan through a bank that is a Preferred Lender. Because the bank is part of the PLP, they can review your application, make the credit decision, and approve the loan directly. This saves you weeks compared to applying through a non-PLP lender, where the SBA would need to review and approve the loan after the bank does.
Why this matters
The Preferred Lender Program matters because it makes getting an SBA loan much faster and easier for small businesses. When you work with a PLP lender, you can get the funding you need more quickly, which is crucial for seizing opportunities or addressing urgent needs. This efficiency can be a big advantage when buying or selling a business, as financing often plays a key role.
When looking for an SBA loan, always ask if the lender is part of the Preferred Lender Program. It can significantly cut down on the time it takes to get your loan approved, which is a huge benefit when you’re trying to close a deal.
When looking for an SBA loan, always ask if the lender is part of the Preferred Lender Program. It can significantly cut down on the time it takes to get your loan approved, which is a huge benefit when you’re trying to close a deal.
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