SBA Loans in Virginia for Small Businesses Now

SBA Loans in Virginia: Complete 2025 Guide for Small Businesses

Small businesses are the backbone of Virginia’s vibrant economy, accounting for over 99% of all businesses in the state. Whether you’re starting a new venture in Richmond, expanding your Alexandria-based enterprise, or acquiring commercial property in Norfolk, Small Business Administration (SBA) loans are an invaluable financing tool for Virginia entrepreneurs in 2025.

Table of Contents

• What Are SBA Loans?
• Types of SBA Loans Available in Virginia (2025)
• Benefits of SBA Loans for Virginia Businesses
• SBA Loan Qualification Criteria
• Top SBA Preferred Lenders in Virginia (2025)
• Step-by-Step SBA Loan Application Process
• Virginia SBA Loan Success Stories
• Local SBA District Offices & Resources
• Virginia State Business Incentives & Economic Development Programs
• Frequently Asked Questions

What Are SBA Loans?

SBA loans are government-backed small business loans designed to encourage lenders to finance businesses that may not qualify for conventional loans. Through various partnerships, the SBA guarantees a portion of the loan, lowering the risk to banks and enabling more flexible terms for business owners.

Types of SBA Loans Available in Virginia (2025)

Virginia business owners can access several SBA loan programs, tailored for startup financing, business acquisition, commercial real estate, equipment purchases, and working capital:

Need capital? GHC Funding offers flexible funding solutions to support your business growth or real estate projects. Discover fast, reliable financing options today!

Test Your Expertise: The Complexities of the 1031 Exchange

As a sophisticated real estate investor, you understand that the 1031 Exchange is a cornerstone strategy for tax deferral and wealth accumulation. But beyond the basics, the intricacies of the 1031 Exchange rules can pose significant challenges. This quiz is designed to test your in-depth knowledge and highlight critical nuances that separate casual investors from true experts in 1031 Exchange transactions.

Instructions: Choose the best answer for each question.

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Page 1 of 5

Question 1: Understanding "Like-Kind" in a 1031 Exchange

Which of the following scenarios most likely qualifies as a like-kind property exchange under IRS Section 1031, allowing for 1031 Exchange tax deferral?

a) An investor exchanges a portfolio of publicly traded REIT stocks for a commercial retail building. b) An investor exchanges their primary residence, used for personal living for 15 years, for a duplex intended for rental income. c) An investor exchanges raw land held for appreciation in Texas for a stabilized apartment complex in Florida, both held for investment. d) An investor exchanges a classic car collection (personal property) for a single-family rental home (real property).

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Question 2: Navigating the 45-Day Identification Period for a 1031 Exchange

An investor sells a multi-family property on June 15th for a 1031 Exchange. According to the strict timelines, by what date must they identify their replacement properties to comply with the 1031 Exchange requirements?

a) July 30th of the same year, as the 45-day period includes weekends and holidays. b) August 29th of the same year, allowing for an extra 45 days if needed. c) December 12th of the same year, aligning with the 180-day completion period. d) January 1st of the following year, if they plan to file for an extension.

Page 3 of 5

Question 3: The Role of a Qualified Intermediary (QI) in a 1031 Exchange

Why is the engagement of a Qualified Intermediary (QI) absolutely critical for the validity of a 1031 Exchange?

a) The QI provides investment advice and helps the investor choose the best replacement property for their 1031 Exchange strategy. b) The QI acts as a liaison with the IRS, directly negotiating tax liabilities related to the 1031 Exchange process. c) The QI holds the proceeds from the relinquished property's sale, preventing the investor from having "constructive receipt" of funds, which would invalidate the 1031 Exchange. d) The QI provides legal and tax advice to ensure the 1031 Exchange is perfectly compliant

Page 4 of 5

Question 4: Understanding "Boot" and its Impact on a 1031 Exchange

An investor sells a commercial building with $500,000 in equity for a 1031 Exchange. They purchase a replacement property for $450,000, effectively reducing their debt by $50,000. What is the tax implication of this scenario within the 1031 Exchange framework?

a) The entire 1031 Exchange is disqualified because the investor "traded down" in value. b) The $50,000 in reduced debt is considered "boot" and will be immediately taxable as partial gain in this 1031 Exchange. c) There are no immediate tax implications, as the primary goal of the 1031 Exchange is only about the "like-kind" nature of the properties. d) The investor can defer the $50,000 as long as they pay off other personal debts with the funds, still qualifying for a full 1031 Exchange.

Page 5 of 5

Question 5: Advanced 1031 Exchange Strategies & Flexibility

An investor aims to sell a highly appreciated single-tenant retail property and replace it with multiple smaller, diversified multi-family units to spread risk. Which of the following 1031 Exchange identification rules best allows for this diversification strategy, maintaining eligibility for a 1031 Exchange?

a) The "Three Property Rule," where the investor can identify up to three properties of any value, regardless of the relinquished property's value, for their 1031 Exchange. b) The "200% Rule," allowing identification of any number of properties, provided their aggregate fair market value does not exceed 200% of the relinquished property's value for the 1031 Exchange. c) The "95% Rule," which states that if more than three properties are identified, the investor must acquire at least 95% of the aggregate value of all identified properties to qualify for the 1031 Exchange. d) All of the above are valid identification rules within a 1031 Exchange, offering flexibility for various investment strategies.

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The Ultimate DSCR Loan for Rental Property Quiz

Are you looking to expand your real estate investment portfolio? A DSCR loan might be the perfect tool to help you achieve your goals without relying on traditional income documentation. Test your knowledge with this quiz to see if you're ready to master the intricacies of a DSCR loan for rental property.

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Page 1 of 5

What is the primary factor a lender considers when approving a DSCR loan for rental property? A) The borrower's personal income and debt-to-income (DTI) ratio. B) The borrower's credit score and employment history. C) The property's potential rental income compared to its monthly expenses, known as the Debt Service Coverage Ratio. This is the key metric for a DSCR loan for rental property eligibility and approval. D) The total value of the borrower's existing investment properties and personal savings.

Page 2 of 5

How does a DSCR loan for a rental property differ from a conventional mortgage for a personal residence? A) A conventional mortgage requires a DSCR calculation, whereas a DSCR loan for a rental property does not. B) A DSCR loan for a rental property primarily focuses on the property's cash flow, allowing investors to qualify without traditional income verification, unlike a conventional mortgage which is based on personal income and liabilities. C) A conventional mortgage has a higher interest rate and stricter requirements than a DSCR loan for a rental property. D) A DSCR loan for a rental property is only available for commercial properties, not residential rental properties.

Page 3 of 5

What is an ideal Debt Service Coverage Ratio (DSCR) for a lender when evaluating a DSCR loan for a rental property? A) A DSCR of 0.75, indicating the property generates 75% of the income needed to cover its debt service. B) A DSCR of 1.00, meaning the property's income exactly equals its debt service. C) A DSCR of 1.25 or higher, as this indicates the property's income is greater than its expenses, making it a strong candidate for a DSCR loan for a rental property and providing a buffer for unexpected costs. D) A DSCR of 2.00, which is the standard minimum for all investment properties, regardless of location or market conditions.

Page 4 of 5

Which of the following expenses are typically included in the calculation of the Debt Service Coverage Ratio for a DSCR loan for a rental property? A) The property's mortgage payment (principal and interest), property taxes, and insurance, which are the core components used to determine if the property can support the debt. B) The property's mortgage payment, property taxes, insurance, and the borrower's personal credit card debt. C) The property's monthly rental income and all utility bills, regardless of who pays them. D) Only the principal and interest payment of the loan, as other expenses are not considered in a DSCR loan for a rental property calculation.

Page 5 of 5

Who would most benefit from using a DSCR loan for a rental property? A) A first-time homebuyer with a W-2 salary and a high debt-to-income ratio, who is looking to purchase a primary residence. B) A seasoned real estate investor with multiple properties who wants to expand their portfolio without using personal income to qualify, making a DSCR loan for a rental property the ideal financing solution for their needs. C) Someone looking to finance a primary residence with a low down payment and a government-backed loan. D) An individual with a very low credit score who cannot qualify for any other type of loan.

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SBA 7(a) Loan Program

• Loan amount: Up to $5 million
• Purpose: Working capital, equipment, expansion, partner buyouts, business acquisition, startup expenses, and commercial real estate
• 2025 rates: Prime + 2.75% – 5%, depending on amount and term
• Terms: Up to 25 years for real estate, 10 years for equipment/working capital

SBA 504 Loan Program

• Loan amount: Up to $5.5 million (more for certain projects)
• Purpose: Major fixed asset purchases such as commercial real estate, construction, or large equipment
• Structure: 50% from bank, 40% from Certified Development Company (CDC), 10% borrower down payment
• 2025 fixed rates: Typically 5.25% – 6.25% APR
• Terms: 10, 20, or 25 years

SBA Microloan Program

• Loan amount: Up to $50,000
• Purpose: Startup costs, equipment, inventory, working capital
• 2025 rates: Generally 8% – 13%
• Terms: Up to 6 years

SBA Express Loans

• Loan amount: Up to $500,000 (increased for 2025)
• Purpose: Fast-track approvals for working capital, business expansion, equipment purchasing
• 2025 rates: Prime + 4.5% – 6.5%
• Approval time: 36 hours or less

SBA Export Loans

• Loan amount: Up to $5 million
• Purpose: Export Working Capital, facilitating international trade
• Features: Flexible collateral, government guarantee

Benefits of SBA Loans for Virginia Businesses

• Lower down payments, sometimes as low as 10%
• Longer repayment terms (10-25 years)
• Competitive interest rates and capped fees
• Accessible for new businesses, startups, and those lacking conventional collateral
• Flexible use of funds for a range of business needs

SBA Loan Qualification Criteria in Virginia

To qualify for an SBA loan in Virginia in 2025, businesses must generally meet these criteria:

• Be a for-profit business operating in the U.S. (including Virginia)
• Meet SBA size standards (based on industry, typically under $8 million in revenue or fewer than 500 employees)
• Demonstrate good personal and business credit (FICO SBSS 155+ or personal credit 660+ recommended)
• No recent bankruptcies, delinquencies on government debt, or recent foreclosures
• Contribution of 10%-20% as down payment for real estate or business acquisition loans
• Business plan and projected financials (especially for startups and acquisitions)

Required Documentation

• Business and personal tax returns (3 years)
• Business financial statements: P&L, balance sheet, cash flow statement
• Business plan (for startups & acquisitions)
• Ownership documentation, licenses, franchise agreements
• Personal financial statement and resume

Top SBA Preferred Lenders in Virginia (2025)

If you’re considering an SBA loan, working with an experienced Virginia-based SBA Preferred Lender can expedite the process and improve your chances of approval. Prominent SBA lenders in Virginia include:

1. Atlantic Union Bank (Richmond, VA) – Leading SBA 7(a) and 504 lender with extensive local expertise
2. Kabbage/Amex Business Lending – Online platform serving all of Virginia for microloans and express loans
3. PNC Bank – Robust SBA division for commercial real estate, business acquisition, and working capital
4. Live Oak Bank (Wilmington, NC, but serves all VA) – Nation’s top SBA 7(a) lender, highly active in Virginia
5. Virginia Community Capital – CDC expertise for 504 loans and mission-driven microloans/business expansion
6. Fulton Bank – Active SBA lending programs with local underwriters

Step-by-Step SBA Loan Application Process in Virginia

1. Assess Eligibility: Review your business’s credit, financials, and loan purpose.
2. Gather Documents: Collect tax returns, business plan, financial statements, and all required paperwork.
3. Select Lender: Choose your preferred SBA lender from above, based on loan type and business needs.
4. Pre-qualification: Submit initial information to get pre-qualified and understand likely loan terms.
5. Loan Application: Complete the SBA loan application (Form 1919 and lender-specific forms).
6. Lender Review: Underwriting review, credit checks, appraisal for real estate, and other due diligence.
7. SBA Approval: Lender submits application for SBA guarantee; SBA reviews and approves.
8. Loan Closing & Funding: Final docs are signed; funds disbursed – typically 30-90 days from application for 7(a) and 504, or as fast as 2 weeks for Express Loans.

Virginia SBA Loan Success Stories

• Startup Commercial Realty Firm, Arlington:

  ✅ Small Business Resources 

  • SBA – Small Business Administration
    https://www.sba.gov

  • SCORE Mentors (Free Mentoring & Workshops)
    https://www.score.org
  • Small Business Development Centers (SBDC)
    https://americassbdc.org

  Are You an SBA Real Estate Loan Expert?

  

  Test your in-depth knowledge on using SBA Loans for owner-occupied commercial Real Estate acquisition. These questions delve into the critical details that can impact your business's growth and financial strategy.

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  Page 1 of 5

  For an existing commercial property, what is the minimum owner-occupancy percentage required for an SBA 7(a) real estate loan, and does this specific scenario qualify?

  A manufacturing company plans to acquire a 30,000 sq ft industrial real estate facility using an SBA 7(a) Loan. The company initially needs 18,000 sq ft for its operations and intends to lease out the remaining 12,000 sq ft.

  A) 60%; Yes, it qualifies. B) 51%; Yes, it qualifies. C) 75%; No, it does not qualify. D) 60%; No, it does not qualify, as they are leasing out a portion.

  Page 2 of 5

  Which of the following sets most accurately represents additional cost categories that can typically be financed within an SBA 504 Loan for a commercial real estate project?

  Hint: Beyond the straightforward purchase of a commercial real estate property, an SBA 504 Loan is highly effective for comprehensive projects.

  A) Business inventory, working capital, and employee salaries. B) Building renovations, long-term machinery essential to operations within the property, and soft costs like architectural fees. C) Advertising expenses, short-term equipment leases, and utility deposits. D) Personal real estate investments, vehicles for personal use, and stock market investments.

  Page 3 of 5

  Between an SBA 7(a) Loan and an SBA 504 Loan, which program generally offers the lowest typical borrower down payment for a commercial real estate acquisition, and what is that common minimum percentage for established businesses?

  A highly profitable professional services firm in a competitive market wants to purchase its office real estate with minimal upfront capital. The firm's owners prioritize cash flow and liquidity.

  A) SBA 7(a) Loan; 15% B) SBA 504 Loan; 10% C) SBA 7(a) Loan; 5% D) SBA 504 Loan; 20%

  Page 4 of 5

  For new construction, what is the initial minimum owner-occupancy percentage required, and what is the maximum timeframe to meet the full owner-occupancy threshold, for an SBA Real Estate Loan?

  A fast-growing tech startup plans to construct a new 50,000 sq ft headquarters using an SBA Loan. They will immediately occupy 35,000 sq ft and have a definitive plan to occupy the remaining 15,000 sq ft within two years as their team expands.

  A) Initial 51%, full 80% within 5 years. B) Initial 60%, full 80% within 3 years. C) Initial 75%, full 100% within 1 year. D) Initial 51%, full 100% within 2 years.

  Page 5 of 5

  What is this crucial requirement, and what fundamental principle does it underscore for the lender?

  When securing an SBA Loan for a commercial real estate purchase, principal owners with a 20% or greater ownership stake are almost universally required to provide a specific type of assurance beyond the collateral of the real estate itself.

  A) A fixed-rate interest payment commitment, demonstrating long-term stability. B) A first-lien position on all personal assets, ensuring full recovery. C) A personal guarantee, signifying the owners' personal commitment to loan repayment. D) A business plan with projected revenue growth of at least 15% annually, showing future viability.

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  Secured a $150,000 SBA 7(a) loan via Atlantic Union Bank for office buildout, initial payroll, and working capital. With the SBA’s 10% down and 10-year term, the firm launched successfully and gained profitability in year two.

• Craft Brewery Expansion, Charlottesville:

  ✅ Real Estate Investor Resources

  • AirDNA (Short-Term Rental Data)
    https://www.airdna.co

  • Rentometer (Rent Comps)
    https://www.rentometer.com
  • Zillow Research & Data
    https://www.zillow.com/research

  DSCR Loan IQ Quiz!

  

  Test your knowledge of Debt Service Coverage Ratio (DSCR) loans!

  Start Quiz

  Page 1 of 3

  What is the primary factor a lender focuses on when approving a DSCR loan for an investment property? a) The borrower's personal debt-to-income (DTI) ratio b) The property's ability to generate enough income to cover its mortgage payments c) The borrower's credit score history over the past 10 years d) The total number of investment properties the borrower already owns

  Page 2 of 3

  If a property has a Net Operating Income (NOI) of $5,000 per month and its total monthly debt service (PITI) is $4,000, what is its DSCR? a) 0.8x b) 1.0x c) 1.25x d) 5.0x

  Page 3 of 3

  Which type of borrower most commonly benefits from using a DSCR loan? a) First-time homebuyers purchasing a primary residence b) Investors with a strong W-2 income and minimal tax deductions c) Self-employed individuals or those with complex income who want to avoid traditional income verification d) Homeowners looking to refinance their primary residence for a lower interest rate

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  What's the most appealing aspect of a DSCR loan for your investment property financing needs?

  A) No personal income verification (no W-2s or tax returns needed!)B) Approval based on the property's cash flow (DSCR)C) Faster closing times compared to traditional mortgagesD) Flexibility for self-employed investors and complex financial situations

  Vote

   

  $980,000 SBA 504 loan (funded by PNC Bank and Virginia Community Capital as CDC) to acquire new brewing equipment and a 5,000 sq ft facility. Required only 15% down, fixed rate for 20 years.

• Main Street Cafe Acquisition, Roanoke:

  Entrepreneur secured $425,000 via SBA 7(a) for business acquisition and working capital, with guidance from Live Oak Bank. The seller carried back 10%, and the new owner rebranded the business successfully.

• Women-Owned Tech Startup, Norfolk:

  $42,500 SBA microloan provided by Virginia Community Capital for software development and hiring. Startup received technical assistance and mentorship through the local SCORE chapter.

Local SBA District Offices, Support, & Resources

Virginia businesses can leverage the expertise of the SBA Richmond District Office:

• Richmond District Office: 400 N. 8th Street, Suite 1150, Richmond, VA 23219 | Phone: (804) 771-2400 | Official Site
• SCORE Richmond and SCORE Hampton Roads chapters offer free mentoring and business plan guidance
• Virginia Small Business Development Centers (VASBDC): https://www.virginiasbdc.org/
• Veterans Business Outreach Center (VBOC) for veteran-owned startups and expansions

Virginia State Business Incentives & Economic Development Programs

In addition to SBA programs, Virginia offers a range of incentives to support small businesses, including:

• Virginia Economic Development Partnership (VEDP): Job creation grants, funding for workforce training, and site selection support
• Virginia Jobs Investment Program: Workforce recruitment and training assistance
• Virginia Enterprise Zone: State and local tax relief, cash grants, and property investment incentives in targeted zones
• Virginia Capital Access Program (VCAP): Supplementary alternative to SBA loans for businesses with non-traditional credit

SBA Loan FAQs for Virginia (2025)

What’s the minimum down payment for an SBA loan in Virginia?

For 7(a) and 504 loans, the down payment typically ranges from 10% to 20% of the project or acquisition cost.

How fast can I get funded with an SBA Express Loan?

Many applicants receive funding within 2-3 weeks of application.

Can startups qualify for SBA financing?

Yes! With a strong business plan, industry experience, and reasonable equity injection (often 20%), startups can qualify for microloans, 7(a), and even 504 loans for owner-occupied real estate.

Where is the best place to start my SBA application?

Contact your preferred lender from the list above or reach out to your local SBA office or SBDC for a pre-application review.

Ready to finance your dream? SBA loans remain Virginia’s best small business financing tool in 2025—enabling startups, growing firms, and entrepreneurs to thrive. Start your application journey today.

Get a No Obligation Quote Today.

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