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How One Business Secured an SBA 7A Loan After Getting Denied

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When Banks Say No, We Say Yes

For many small business owners, especially those from underserved communities, traditional bank loans feel out of reach. One of our recent clients — a contract cleaning company with over 100 active clients — faced this exact situation. Despite strong revenue and growth, they were denied SBA funding due to debt-to-income (DTI) ratio issues.

Here’s how Kapya stepped in, restructured the case, and helped them secure a $250,000 SBA 7A loan that saved over $15,000 per month in payments and unlocked new business opportunities.

The Challenge: Loan Denial Despite Strong Operations

This business was billing over 100 recurring clients and had weathered the 2022-23 inflationary period well, even growing through deep-sanitizing services. They had:

  • 2023 Revenue: $1,025,000

  • Net Income: $136,785

  • Equipment and Vehicles: Essential to operations

  • New Contracts in Pipeline: Worth up to $30,000/month

But their file was denied by an SBA lender due to high existing debt and a misclassification of business liabilities.

Our Approach: Restructuring for Success

Kapya reviewed the entire loan submission and identified two critical issues:

  1. Incorrect Debt Aggregation: Vehicles were mistakenly bundled with general business debt.

  2. Unclear Working Capital Justification: The client hadn't tied funding needs to specific growth opportunities.

We corrected the debt classification, documented the equity in business-owned real estate, and showed a direct link between loan usage and projected revenue.

Then, we highlighted:

  • A plan to pay off $200,000 in high-interest loans

  • A $15,000/month savings with a lower SBA rate (7%)

  • A need for $150,000 in working capital to pursue pending contracts

 

The Result: $250,000 Funded — and More on the Way

The result? A $250K approval with one of the nation’s largest non-bank SBA lenders. The client is now saving over $15K/month and has the flexibility to pursue an additional $25K/month in new revenue.

Even better: after 3 months of on-time payments, they’ll be eligible for an additional $100K.

Takeaways for Other Business Owners

  • Getting denied isn’t the end. It’s often about presentation, not worthiness.

  • Properly classifying debt and assets matters. A clean balance sheet opens doors.

  • Tie funding to growth. Show exactly how capital will generate revenue.

Need Help? Let’s Talk.

At Kapya, we help underserved and Latino-owned businesses navigate complex funding situations. If you've been denied, misclassified, or just don’t know where to start — we're here.

Free Consultation | Fast Prequal | SBA, Term Loans, Equipment & More