Small Business Administration (SBA) offers numerous loan programs to assist small businesses. Its primary business loan program is to help qualified small businesses to obtain finance in case of ineligibility for business loans through normal lending channels.

There are 2 ways in which money can be borrowed to finance your franchise business from SBA. First, to borrow directly from SBA, but they have limited funds. Second, to borrow from regular banks and financial institutions that are authorized by SBA to lend money, to people who want to start a franchise business, or any business, or expand their current franchise business. SBA almost always guarantees these loans. If borrow directly from SBA, you only need to find an SBA office and fill out the necessary forms. If borrow from a bank or financial institution, need to find them and contact them directly. SBA Loans from these banks are available for any franchise business opportunity.

SBA is primarily a guarantor of loans made by private and other institutions. Every application needs positive credit merits to be approved. These are the same credit factors a lender will review and analyze before deciding whether to internally approve loan application, seek a guaranty from SBA to support their loan to you, or decline your application all together. However, SBA will generally not decline a loan where inadequacy of security is the only unfavorable factor. The U.S. Small Business Administration (SBA) serves as the cash stream for fledgling businesses through the agency's numerous loan guarantees and direct grants, resulting in an overall portfolio of more than $45 billion.

The 7(a) program : Under 7(a) the SBA can guarantee 85% of loans up to $150,000 and 75% of larger loans. The agency's guarantee cannot exceed $1 million, and the most that can be borrowed is $2 million. 10 billion. Those are the general parameters, but there are a couple of specific 7(a) products you should be aware of:

1. LowDoc. SBA-authorized lenders who practice "relationship lending" that is, they really know the people they're lending to and whether they're credit worthy are empowered to make loans with less documentation than normally is required. Obviously, this speeds up the process.

2. SBAExpress. This product gives the lender full authority over the loan process, with no input from the SBA.

There are lesser-known programs that are of potential value, depending on the particular situation.

• The 504 loan program. This is fixed-asset lending, generally secured by your plant or physical building, though long-term capital equipment also may qualify. The borrower ponies up a down payment of between 10% and 20% of the loan amount, the first mortgage lender (generally a bank) puts up about 50% and the SBA picks up the remainder. The SBA contribution is funded through the sale of private sector debentures guaranteed by the agency. The maximum SBA debenture generally is $1 million (and up to $1.3 million in some cases).

• Micro-loans. Under the program, which since 1993 has doled out more than $100 million, small businesses can borrow up to $35,000 from nonprofit organizations that in turn borrow the funds from the SBA, whom they're obliged to repay. As part of the program, the SBA also gives grants to nonprofit outfits that help small businesses find and qualify for loans.

• SBICs. Small-business investment corporations are venture capital firms that receive supplemental funds from the SBA if they're willing to live by SBA rules. They go after a smaller market, making investments in the $1 million to $5 million range, compared with $25 million to $50 million for more traditional VCs. Typically, SBIC money is exchanged for equity, debt (in the form of warrants or options) or royalties (a certain percentage of the firms profits).

• ACE-Net. For a fee of $450, small businesses can put their plans and funding requirements on a network accessed by hundreds of angel investors around the country.