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Live Oak Bank Review 2019: SBA Loans for Growth

April 23, 2019
Small Business, Small Business Loans
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  • Loan amount: $75,000 to $5 million
  • APR: 5.50% to 8.25%
  • Loan term: 10 to 25 years
  • Approval time: Average of 45 days to process an SBA loan application
Apply now at Live Oak

If you need a major cash infusion to take your small business to the next level, Live Oak Bank is a good option for obtaining Small Business Administration loans.

Live Oak may be right for your business if you:

Need capital for a major expansion: The bank offers SBA loans of up to $5 million. Borrowers typically use proceeds to expand operations.

Are an established business with strong financials: To qualify for a loan, your business must have strong enough cash flow to cover loan payments, without any bankruptcy history or outstanding tax liens.

Are in one of the industries the lender focuses on: Live Oak lends in several select industries, including agriculture, healthcare and wine/craft beverage.

» MORE: Compare long-term business loans

In this article:

Reasons to use Live Oak Bank

Where Live Oak Bank falls short

Reasons to use Live Oak Bank

The guidance of an experienced SBA lender

Live Oak Bank perennially ranks among the highest-volume lenders in the SBA 7(a) program.

The bank focuses on offering SBA loans to businesses in specific industries, some of which other lenders don’t serve. They are:

  • Accounting and tax firms
  • Agriculture
  • Automotive
  • Educational services
  • Family entertainment centers
  • Funeral homes and cemetery
  • Government contracting
  • Healthcare and dental
  • Hotels
  • Insurance
  • Investment advisory
  • Pharmacy
  • Renewable energy
  • Self-storage
  • Senior care
  • Veterinary
  • Wine/craft beverage

The bank has a team of financing specialists dedicated to each industry, so when you apply for a loan, you’ll be working with people familiar with your industry as well as the SBA process.

Live Oak Bank also offers non-SBA commercial loans, but these make up a small fraction of its financing. And it offers federally guaranteed loans from the U.S. Department of Agriculture geared to farms and other rural small businesses.

» MORE: What you need to know about SBA loans

Faster application process than traditional banks

With the help of web-based tools, Live Oak Bank takes an average of 45 days to process an SBA loan application. That’s faster than traditional banks, where the process can take more than three months.

InExpensive financing for high-value SBA loans

Live Oak Bank’s average SBA loan size was $1.2 million in 2018, according to the company. The bank offers an annual percentage rate, which includes all loan fees, as low as 5.50%. For an SBA loan of more than $50,000 paid over 10 years, the APR is the current prime rate plus a spread of up to 2.75%, or 8.25%. That’s tough to beat, especially for loans of more than $1 million.

Live Oak Bank

best for

  • Businesses looking for SBA loans of up to $5 million
  • Growing businesses with strong financials
  • Businesses in these industries: Accounting and tax firms, agriculture, automotive, educational services, family entertainment centers, funeral homes, government contracting, healthcare and dental, hotels, Insurance, investment advisory, pharmacy, renewable energy, self-storage, senior care, veterinary, wine/craft beverage

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Where Live Oak Bank falls short

Only certain industries qualify

If your small business is in trucking, information technology, janitorial services or a number of other industries, Live Oak Bank is not an option. The lender serves only the industries listed above.

Stringent SBA requirements

Live Oak Bank uses its online platform to streamline the SBA loan application process. However, you still have to meet the SBA’s requirements and provide a long list of documents and information.

Here are documents to gather before applying to Live Oak:

  • Three years of business tax returns
  • Three years of personal tax returns
  • Year-to-date profit and loss statement, and balance sheet
  • Debt schedule if you are an existing business
  • Promissory note if you are refinancing an existing loan
  • Purchase agreement or letter of intent if purchasing
  • Estimate/bid if you’re considering construction
  • Resume
  • Personal financial statement

Longer process than other online lenders

Getting an SBA loan within 45 days is an accomplishment. But you may need financing more quickly to deal with an emergency or pounce on an opportunity. In that case, Live Oak Bank wouldn’t be a good option.

Compare Live Oak Bank with other lenders

If you want to compare Live Oak Bank with other lenders, use NerdWallet’s small-business loan tool. We gauged lender trustworthiness, market scope and user experience, among other factors, and arranged them by categories that include your revenue and how long you’ve been in business.

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