The applicant (including an Operating Company) must be creditworthy. Loans must be so sound as to reasonably assure repayment. SBA will consider:
Character, reputation, and credit history of the applicant (and the Operating Company, if applicable), its Associates, and guarantors;
Experience and depth of management;
Strength of the business;
Past earnings, projected cash flow, and future prospects;
Ability to repay the loan with earnings from the business;
Sufficient invested equity to operate on a sound financial basis;
Potential for long-term success;
Nature and value of collateral (although inadequate collateral will not be the sole reason for denial of a loan request); and
The effect any affiliates (as defined in part 121 of this chapter) may have on the ultimate repayment ability of the applicant.
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