Banks, savings and loan institutions, credit unions and other lenders work with the SBA to provide small businesses with loans structured under the 7(a) guidelines described above. Lenders are active participants in the loan application process since they are the first stop for potential applicants and because they ultimately provide the loan funds.

Potential applicants should first approach their local lending institutions and apply for a loan using that institution's application materials. Lenders then review the application for its credit and management merits. If  the lender certifies that the loan will be approved only with Federal Guaranty, then they may submit the loan application to SBA.

There are different means lenders use for submitting loan applications to the SBA. The method used reflects the relationship the SBA has with the lender. It also determines how long it will take the SBA to make a decision regarding your application. For example:

• Under the regular delivery program, lenders submit a completed loan application to their local SBA office for review. The application is essentially the same one borrowers initially submit to the private lender. The SBA completely analyzes this application and then submits to the lender its decision regarding the guaranty. The review process generally takes 13 days on average. This method is generally used by lenders who do not frequently seek a guaranty or where the particular loan requested is complex, involves negative character issues, or is for one of SBA's special credit programs, which do not allow for more expedient processing.
• If you choose a lender that participates in the SBA's Certified Lender Program (CLP) or the Preferred Lender Program (PLP), the time and paperwork required to receive a guaranteed loan is significantly reduced. Under the CLP program, the SBA simply reviews the lender's credit analysis rather than conduct a second, separate analysis. Because the SBA relies on lender's credit knowledge, it can make its eligibility decision in three working days. Under PLP, the SBA gives full authority and responsibility to select lenders for determining the loan applicant's eligibility for a guaranteed loan, closing and servicing the loan, and, if necessary liquidating the loan. PLP lenders can approve a SBA guaranty without first sending the application to the SBA.
• For loans of $150,000 or less, lenders can submit loan applications to the SBA using the LowDoc Program. After the lender reviews a completed application using their own internal documents and procedures, they can then have the applicant fill out the front of a one-page application while they complete the back. The SBA will provide its answer within 36 hours of receiving this application
• For minority owned and women-owned businesses, the SBA is experimenting with a pre-qualification method. This process allows the application documents to be evaluated by a SBA pre-qualification intermediary before they are submitted to a lender. If the intermediary is satisfied that the application has a chance for approval, they will forward it on to the SBA. If the SBA determines that the application should be approved, it will issue a letter on behalf of the applicant certifying the SBA's guaranty. The applicant can then take the letter and the completed application materials to a lender for their decision.

Depending on your situation and needs, it is recommended that you discuss with your lender their relationship and history with the SBA so that you understand how they will approach the agency. You may want to consider applying for an SBA loan through the most experienced banks as this may decrease the amount of time it takes to receive a decision on your loan guaranty.