Top Iowa SBA Lenders | Iowa SBA Loans

Last update: Jun 16, 2024

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Top SBA lenders in Iowa

RankBank# of LoansAvg Interest Avg Loan
1U.S. Bank409.9% $52,720
2Farmers State Bank178.6% $205,000
3MidWestOne Bank1310.8% $149,746
4Lincoln Savings Bank1111.1% $299,264
5Hills Bank and Trust Company97.6% $136,867
6United Midwest Savings Bank811.1% $150,000
7BayFirst National Bank812.9% $132,363
8Wells Fargo814.1% $15,625
9Readycap Lending, LLC713.4% $364,071
10Northwest Bank78.2% $337,500
11Farmers & Merchants Savings Bank79.7% $200,786
12Cedar Rapids Bank and Trust611.0% $185,767
13Fairfax State Savings Bank69.9% $146,333
14Two Rivers Bank & Trust59.0% $261,140
15TruBank58.7% $160,180
16Huntington Bank511.1% $242,160
17United Bank of Iowa58.2% $50,200
18Community 1st CU57.6% $152,140
19Bank Iowa58.2% $52,040
20Clear Lake Bank & Trust47.2% $141,500

Interest rates for SBA loans in Iowa

The table below shows the average interest rates for SBA loans in Iowa during the past few quarters for loans over $50,000. Note that most SBA loans are variable-rate loans, so borrowers may benefit from lower rates in the future if the Federal Reserve lowers interest rates.

YearQtr# of Loans Avg LoanAvg Rate
2024164 $396,37110.1%
2023443 $419,51710.0%
2023355 $439,0329.6%
2023244 $299,8589.3%
2023152 $462,0729.1%
2022436 $437,1907.7%
2022355 $618,1216.4%
2022272 $404,3375.4%
2022168 $469,6515.1%
2021447 $351,9774.9%
2021383 $676,4305.2%
2021261 $492,7074.8%
2021153 $506,8285.1%

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Top industries receiving SBA loans in Iowa

Here are the top 20 industries in Iowa based on small business loan volume from last year. This information can help you gauge what to expect for your business in terms of interest rates from SBA lenders:

RankIndustry (NAICS Description)# of LoansAvg Interest Avg Loan
1Full-Service Restaurants209.4% $338,500
2Limited-Service Restaurants129.7% $322,508
3Fitness and Recreational Sports Centers810.7% $257,150
4Landscaping Services89.9% $148,988
5Beauty Salons68.5% $58,783
6Plumbing, Heating, and Air-Conditioning Contractors610.7% $29,167
7Residential Remodelers611.4% $60,000
8All Other Specialty Trade Contractors510.2% $547,320
9General Automotive Repair510.6% $86,000
10All Other Automotive Repair and Maintenance49.1% $157,500
11Electrical Contractors411.4% $95,000
12Local Messengers and Local Delivery48.1% $243,175
13Nail Salons49.8% $46,250
14Other Personal Care Services49.6% $173,525
15Pet Care (except Veterinary) Services49.6% $1,133,725
16Snack and Nonalcoholic Beverage Bars410.3% $178,200
17Supermarkets and Other Grocery (except Convenience) Stores48.2% $165,625
18All Other Personal Services38.0% $67,000
19Car Washes37.2% $1,009,367
20Child Day Care Services39.0% $1,460,000

Iowa SBA lenders FAQs

 

Who are the top SBA lenders in Iowa?

The best SBA lenders in Iowa are those closing the highest number of SBA loans in the state. You can find them listed in the table above. This data is updated quarterly and reflects the rolling 12-month period.

 

How do I qualify for an SBA loan in Iowa?

To qualify for an SBA loan in Iowa, your business (or the one you’re acquiring) must meet size standards, demonstrate the ability to repay, and have a sound business purpose. Contact an SBA-preferred lender in Iowa or use our SBA Lender Match tool to check your eligibility. Common reasons for disqualification include:

1. Insufficient Cash Flow: Ensure you have enough cash flow to cover SBA loan payments. Use our SBA Maximum Loan calculator to determine your maximum loan amount.

2. Low Credit Score: A credit score of 650 or above is generally required.

3. High Working Capital Needs: Loans over $150,000 primarily for working capital face stricter scrutiny.

4. Business Acquisitions: Lack of industry or relevant experience and insufficient down payment (typically 10% or more) can be disqualifying factors.

Complete our SBA Lender Match tool, and we’ll provide a preliminary assessment of your SBA loan eligibility. We can then connect you with lenders who specialize in Iowa SBA loans.

 

What is the SBA 7(a) loan program?

The SBA 7(a) loan program is the most popular SBA loan, offering up to $5 million for various business purposes, including working capital, equipment, and real estate. This program is available to businesses throughout Iowa and offers flexible terms. Unlike SBA 504 loans, which require a Certified Development Company (CDC) and full collateralization by real estate, 7(a) loans are quicker and more versatile. At SBAlenders.com, we specialize in assisting with SBA 7(a) loans and can also help with 504 loans if needed.

 

What is the SBA 504 loan program?

The SBA 504 loan program offers long-term, fixed-rate financing for major assets like real estate and equipment, providing up to $5.5 million. Designed to promote business growth and job creation in Iowa, this program requires both a Certified Development Company (CDC) and an SBA lender to finance portions of the loan. While SBA 504 loans offer significant benefits, they typically take longer to close and require full collateralization, resulting in lower activity compared to SBA 7(a) loans. At SBAlenders.com, we can assist you with securing an SBA 504 loan to support your Iowa business.

 

Which SBA loan is easiest to get approved for?

SBA loans of $150,000 or less from an SBA preferred lender are the easiest to get approved for. The application process is streamlined, with most lenders focusing primarily on the individual borrower’s credit score rather than the business itself.

 

What types of businesses are eligible for SBA loans in Iowa?

Most small businesses in Iowa are eligible for SBA loans, including those in manufacturing, retail, service, and agriculture. Certain restrictions apply, so it’s best to consult with your Iowa SBA lender or SBAlenders.com to confirm your eligibility.

Common Ineligible SBA Loan Inquiries we see at SBAlenders.com include:

  1. Passive Income Businesses: Businesses generating passive income, like rental real estate or apartment purchases, are ineligible for SBA loans, which are designed for active businesses. Hotels are eligible but AirBNBs are not.
  2. Leasing or Finance Companies: Businesses mainly involved in leasing or financing are not eligible for SBA loans due to their operational nature.
  3. Venture Capital or Private Investor Consortiums: Entities formed solely to invest in other businesses do not qualify for SBA loans. This includes general partners of special purpose vehicles seeking to leverage equity for investments.

 

How do I find an SBA-approved lender in Iowa?

Through our SBA Lender Match tool, we can introduce you to three (or more) SBA lenders who serve the Iowa market. All of the SBA lenders in our network are SBA preferred lenders, and the individual bankers work exclusively on SBA loans.

 

Can I use an SBA loan to buy a franchise in Iowa?

Yes, SBA loans can be used to purchase a franchise in Iowa or create a startup. In fact, SBA lenders prefer franchises over startups as generally the franchise has already demonstrated success in the marketplace. Your SBA lender can help you navigate the process and secure financing for your franchise purchase.

 

How can an SBA loan help my small business in Iowa?

SBA loans offer several advantages over conventional loans, making them especially attractive for acquisitions. They have no collateral requirements, no debt covenants, and offer longer repayment terms—10 or 25 years—which result in lower monthly payments. Although SBA loans generally have slightly higher interest rates, these benefits can help your Iowa small business manage cash flow, invest in growth opportunities, and reduce financial strain.

 

Can I refinance existing debt with an SBA loan in Iowa?

Yes, SBA loans can be used to refinance existing business debt under certain conditions, but in general one SBA loan can’t be used to pay off an existing SBA loan. This can help reduce your interest rate and improve cash flow as SBA loans have ten-year terms or 25 years if real estate. Talk to your SBA lender in Iowa to explore refinancing options.

 

How do SBA loan guarantees work?

SBA loan guarantees reduce the risk for lenders by backing a portion of the loan amount. This makes it easier for lenders to finance small businesses in Iowa that might not qualify for conventional loans. However, this guarantee doesn’t prevent the lender from pursuing the borrower in the event of a loan default. The lender is required to do so and will require all 20%+ owners of the business to personally guarantee the SBA loan.

 

What support services are available for small businesses in Iowa?

Iowa offers numerous support services for small businesses, including Small Business Development Centers (SBDCs), SCORE chapters, and local chambers of commerce. These organizations provide free or low-cost business counseling, training, and resources to help your business succeed.

 

Other FAQs about the best SBA lenders in Iowa

People frequently ask us if one of the banks above is 1) on the Iowa preferred lender list 2) an approved lender in Iowa, or 3) participating in the Iowa SBA Express lending program. All these questions revolve around whether a given SBA bank makes small business SBA loans in Iowa and can they process SBA loans quickly. The answer is yes, of course. These are not the small banks that only make a few SBA loans a year and do not understand the SBA 7(a) loan program.

We analyze thousands of SBA loans each year and rank lenders based on recent activity. Although many SBA lenders will only lend in their local market(s), there are a handful of extremely aggressive nationwide SBA lenders who will lend anywhere. These lenders understand the SBA program as well as anyone and move very quickly, so we recommend not limiting your search to your home state. If you utilize our lender match tool, we can find you suitable SBA banks based on your geography, industry, and company and size at no cost or obligation to you to save you valuable time.

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