Small business owners are typically an optimistic and resilient group. But even the most capable and confident of them can be caught off guard by an economic downturn’s various headwinds, from slower cash flow, delayed receivables, to rising costs, or some combination of these and other issues.
According to TD Bank’s 2025 Financial Preparedness Survey, nearly all small business owners believe they’re ready to weather the next 12 to 18 months. Yet 72% conceded they could only handle revenue shortfalls for two quarters or less.
That gap between confidence and readiness underscores the importance of financial flexibility. And for many small businesses, that’s why an SBA loan should be a consideration.
Why SBA Loans Deserve a Fresh Look
Too often, SBA loans are overlooked due to outdated assumptions—that they’re slow, overly complicated, or only for businesses that can’t qualify elsewhere. In reality, SBA lending has evolved. SBA programs, such as its 7(a) and 504 loans, now offer accessible, affordable, and flexible financing for a wide range of business needs. For example, at TD Bank, we see small business owners use these funds to:
- Acquire an existing business: With many baby boomer-owned businesses hitting the market, SBA loans can help buyers preserve local jobs and carry on legacies.
- Purchase property: Instead of leasing a building for their operations, business owners can use SBA loans to buy one instead and build equity in it over time.
- Expand operations: Whether it’s adding another location or new equipment, SBA funds can support smart growth.
- Bridge short-term gaps: With longer terms and lower monthly payments, SBA loans are a strong fit for businesses navigating seasonal or economic fluctuations.
- Provide working capital: SBA Loans can act as working capital to manage day-to-day operations and meet short-term financial obligations.
Real Benefits for Real-World Needs
What makes SBA loans even more compelling? Their government-backed loan guarantees enable lenders to say yes more often—and with terms that allow owners to focus more on building their businesses and less on scrambling to make their loan payments.
Unlike conventional loans, SBA loans are designed to support small businesses that may not check every box for creditworthiness. They are designed to bridge the gap for small businesses that may not qualify for conventional loans, offering terms and conditions that make credit more manageable. Key benefits include:
- Lower down payments: SBA loans often require as little as 10% down, compared to the 20-30% down payments typically required for conventional loans. This allows small businesses to preserve cash for operational needs.
- Longer terms: SBA loan amortizations of up to 25 years are longer than those of conventional business loans, so monthly payments are often smaller. This can further improve cash flow and free up funds for other business priorities.
- Competitive rates: With both fixed and variable options, SBA loans typically feature rates that are more favorable than conventional alternatives.
Finding the Right Banking Partner
One reason small business owners may hesitate to pursue SBA loans is the perception that they can take too long to process. That’s where your lender matters. Working with an SBA Preferred Lender can streamline the process dramatically.
SBA Preferred Lenders are authorized to make credit decisions on behalf of the SBA. That means faster approvals, simplified paperwork, and guidance from teams who understand both your business and the nuances of SBA programs. In 2024, TD Bank ranked No. 1 in total SBA loans financed across our East Coast Maine-to-Florida operating regions and was No. 2 nationwide among all SBA lenders in total SBA loans issued.
But speed is only part of the story. Trusted lenders can help entrepreneurs navigate complex financing, such as combining SBA loans with tax credits or other incentives, to unlock funding for even the most ambitious projects. Even more, good bankers should be able to provide strategic business advice, not just capital.
Final Thoughts: Start the Conversation
The right time to explore SBA financing isn’t when you’re in a cash crunch; it’s now, when you’re planning your next move. Whether you’re expanding, buying, or building for the future, an SBA loan might be the smartest financial decision you haven’t considered.
Talk with a trusted banking partner who understands the full spectrum of SBA lending and small business strategy. With the right guidance, you can turn financial flexibility into a competitive advantage that can enable you to thrive during uncertain economic times, not just survive them.
To learn more about SBA loan options and how they can support your business goals, visit TD Bank’s SBA Loan Programs page. Or connect with your TD Bank Relationship Manager to start a conversation tailored to your growth strategy. You can also visit www.sba.gov for more information on SBA loan programs.
Tom Pretty is the head of SBA Lending at TD Bank.
Photo courtesy Getty Images for Unsplash+