An SBA loan is not the problem, paying only the minimum payment on any loan is the problem. Also, taking on debt that you can't afford is a problem.... but it's not the SBA loan in and of itself thats a problem. So no, SBA loans are not a bad idea if you have a plan.... no debt is a problem if you have a plan on how to use it and pay it back. If you have a business, you're going to take on some type of debt, you just have too unless you have a ton of cash sitting in your bank account that you can use to finance your business. But usually thats not the case. You're going to have to take loans out somewhere at sometime unless you're seeling equity in your business.

This was an irritating call. Just her lack of order.

She's buying time and that move wasn't a bad one. She did a balance transfer with a lower interest rate and a lower monthly payment. She may even have room to improve her life if she's disciplined and plays her cards right.

This lady high asf 😂

Dave was more upset with her because she didn't follow his typical advice and live like a homeless person for 2 years to pay off the credit card debt. IF this woman does the right thing and hammer the loan with extra payments to pay off the loan as fast as possible she'll be ahead of the game. 4% interest? Nice! Just stop telling people " I got an SBA loan" to pay off my credit card debt.

Those SBA loans have covenants that say you can’t use the proceeds to refinance existing debt. If she’s not able to demonstrate appropriate usage of the money, she may be in trouble. Surprised Dave didn’t mention that.

It's actually illegal to pay off other debt with the SBA loan

She did the right thing

“I don’t know how to do that”. You get a frickin job lol

Getting the loan was a great idea. You can always pay off quicker if you want Steve.

This call is so irritating, if you’re going to call in at least have some info ready. It sounds like to me she needs to get a real job on the side until being an artist proves to make a lot more money. Even driving Uber for a couple hours at night would be a great start not to mention she could promote her paintings or drawings to passengers. This being said she doesn’t seem to eager to pick up extra hours anywhere 🤷🏻‍♂️

So many people have done a wonderful job analyzing the video. I just wanted to speak to the numbers for some context. 29% and 3.75% are the annual rates of interest. 29% on $19,000 credit card debt is interest only of $459/month. $19,000 at 3.75% amortized over 30 years has a payment of $87.99 with $59.38 as an interest expense. Let’s say the SBA loan had a 3% fee - that would still only be $570 which is basically only one month of interest! So, yes - Dave is right in that many people would pay the minimum and spend the excess. To assume everyone does this is wrong and not helpful. That $400 of interest saved can go a loooong way!

The ELDI loans is once in a lifetime debt.... 3.75% fixed, 30 years, no payments for a year, and no recourse to the owner..no personal guarantee, the debt dies with the corporate structure in the event of liquidation...i own multiple businesses and grabbed as much as that as i could, great arbitrage opportunity.I get Dave's strategies are aimed at less sophisticated people financially.

I guarantee a good amount of the caller's credit card balance was interest charges accumulating at what appears to be a default rate of 29.xx% APR. She might have missed a some payments. It is true that she needs to increase her income and do so quickly, but we're in a pandemic with 20% REAL unemployment rate. Given these conditions, and given the fact that her debt was growing by $400 each month, I think he made a good financial decision to refinance it at 3.75% APR. The 30 year term doesn't matter as long as she pays it off ASAP, maybe in 2-5 years once the economy starts to improve and she can increase her income. We get it Dave, debt is bad and prolonging a debt situation isn't ideal, but this idea that everything has to fit into only two categories "good" or "bad" could be counter to what you're trying to teach people. Clearly, there are two separate issues here. If it were a medical situation, you first need to stop the bleeding/suture up (aka refinance the debt) then do the healing/recovery (aka increase income and pay down debt). If you tell someone they made a bad move when they actually did the best under the situation, you are not helping them build their self confidence with respect to proper financial planning and management.

I have a feeling she is not making enough to pay this debt off

The figure of "99% of people won't do that" is false. People do learn and change. Even if she paid just $500 a month she'd be done with it less than 5 years. I know people who've had bad debt like credit cards and change their ways and get rid of it in a reasonable amount of time.

The biggest problem is she violated the terms of the EIDL by not using it for what it was for.

SBA loans are not supposed to be used for your personal expenses!

I got a feeling she won't listen lol

So In other words SBA loans are bad for paying off debt but SBA loans are perfect for business start ups

Why don't she share her house? Cut her bills. Cook and refrigerate for 1 week.

Please have your numbers in order before calling dave ramsey show lol

The title is misleading. This says nothing about SBA loans or analyzing them.

I applied for, and received, one for our farm business. I did not understand it to be a loan that could be used to pay off *prior debts* such as credit cards. However, I could be wrong. The document was several pages which I was trying to decipher on my iphone. We are using it for *future* (loan origination date forward) business expenses, not past. And the wording does say that if someone came knocking and wanted justification for the funds, you need to have receipts ready and willing to show. And this woman is correct...it is 3.75% and it does not start paying back until one year from origination.

Bit strange to call loan consolidation a scam and then describe the problem: the person who has the loan might make smaller payments. We are talking about adults here. They can take some freakin’ responsibility and stick to a proper payment schedule. It is a lot better to have a (much) lower interest rate. That wasn’t stupid, that’s great.

thank you for providing all the software used for this program works perfectly and okay coming back for more since this is working alright.

There are so MANY ppl that recently received an sba loan, they had to pay $1500 to the person that fixed up their application giving themselves $10,000 debt with maybe $1000-$2000 that is supposedly free 🤣 NOTHINGS FREE. It all comes with a price. When the truth is stretched you don’t need whatever you applied for. I’m debt free except my mortgage and if I want something I’ll save for it. I’d like to see Mr. Ramsey addressing this situation (I love the Dave Ramsey show🥰)

She’s probably smoking something before the call 🤣

I have a business in the art industry. My customers are artists. 90% of them can't tell you what their annual income is. They can't tell you what their expenses and overhead are. They can't tell you what their profit margin is. She's very typical. She can't sell more art because she has no idea how to market it. She can't raise her prices because it's not good enough to sell at a higher price. Her gross annual sales are about $48,000. She'll still be doing $48,000 in sales when she's 78 years old.

This is what denial looks like........

Thank you for sharing 🙌

I took out a $35,000 loan with an 18 month repayment plan. Yeah it's been hard as hell but I've only got 6 more months!

$4500 a month in income is a very decent income for 1 person! A family of 3 can live on $3000 a month. I’m surprised they didn’t ask her if she was living on a written budget. I think that’s where her money is going - she doesn’t know! Cuz $4500 is a lot for just “mortgage, food, to get by” as she said .... somethings not adding up

He should have complemented her for her decision to restructure her debt and advise her to start making larger payments towards the principal, but he is badgering her. SBA loan was a great idea, just pay the principal/ interest quicker.

Speak Dave!! I thought the exact same! It’s mentally crazi how the mind works. Once out of debt millions of materialistic things look at you and say buy me now!

If she only paid the 108 for the entirety of the loan, she would pay almost 39k for what was only 19k in debt.

Where does it say that she took at SBA loan? The title of the video is misleading. She would never qualify for an SBA loan since you need 10% down anyways, which she clearly did not have.

Still learning of the ins and outs of SBA but correct me if I’m wrong, if she defaults isn’t 85% of it backed ?

This woman caller is clueless of her own finance. She was unprepared, could not answer any question directly, and was not confident in any of her responses. The smartest thing she can do is pay off loan as quick as possible with the same volume of payment as if she was still paying her credit card monthly payments ($1K)... but we all know she wont..

I think moving debt to a lower interest rate is fine as long as you continue to pay it off. Why wouldn't you want to pay less interest?

Let’s see I applied and was approved back July 2020 was told I was funded bank says they have no information call sba they say in process here we are 2021 and still they say in process it’s a scam

19k @ 29% interest does not equal 19 payments of 1k a month to pay the loan. Dave where did you go to elementary school?

I have 4 SBA loans for my business. 1st off SBA loans max terms are 25 years. 90% of them are 10 year loans. All four of mine are 10 year. Secondly they will not let you use that money for debt. Something is not adding up.

I think she needs a little more than a loan... like a financial class

She sounds lazy unless she has a medical problem that she doesn't want to share.💁‍♀️💁‍♀️💁‍♀️

U can’t use SBA loan to pay off credit card debt. SBA loans have criteria or conditions attached..

She needs to reinvent herself. Learn a new skill. 53 years old and still an 'artist'. Time to move on to another avenue.

Its cheaper to pay off 3.75% debt more quickly than 17%+ credit card debt. FACT.

Im a veteran and looking to partner with some investors on a small business. research is saying the SBA express loan is the only way to go. can you advise? looking to go in around $500k.

Yeah she was all over the place. Can’t save everyone guys

Dang I work for the SBA, doing the exact loan (EIDL) that she has... I probably gave it to her lol

"I don't know how to do that." She doesn't know how to go on to the computer and fill out an online application to Target? Don't know how, or dont want to? Artists don't just make a living sitting behind a canvas. There's a whole world she should be exploring, where someone else writes and hands her a check. And then this becomes her side gig.

"i had alot of debt so i got a loan".......

Now she will have a loan payment for the SBA loan and she will run the credit cards back up. I guarantee as sure as the sun will rise tomorrow in a year she will be back into credit card debt.

Sounded like a good move until she was excited about the 30 year loan. I would have been excited to save 25% interest vs the credit card.

The people that call into this show are extremely bad with money, it's crazy...

Hello Sir Dave Ramsey and to everyone making this show great and amazing. Today its my bDay and also today I got my FREEDOM back! Thanks to you Sir Dave. ever since you came to my rescue i followed everything, so now i have all these knowledge being smart on money decisions. GOD BLESS and ill be a number one fan and watching the show forever!!!!!🤣👏👍❤❤❤

We got a SBA Loan. 3.75%. our loan was pretty big. $381,000... Paying $13,000 a year in interest. 😢 We did also consolidated our debt. I knew that it was a big no no from Dave but it was a risk I was willing to take. Minimum payment is about $2,000... It is very doable in case things go South for us. But we are throwing every thing we got now. As of today 6/16/2023 I still owe $320,000.... We srarted paying early, but it was so sad looking at our first couple payment just going towards interest. My advice to you, if you got an sba loan, start paying it off now, dont wait. We got this!!!! God bless 🙏

This lady is so nerve-racking 10 seconds of conversation took her 2 minutes to get out. 🤦‍♂️

Yes he correct ab the psychology But if you take Dave Theory on 10 percent growth on good growth mutual funds he talks ab that average 10 percent gain and take 100,000 sba loan at 3.75 percent .. u be making a yield of 6.75 percent and 100,000 would be a profit of $6750 a year and if sell parts of it after it a year it be tax at capital gains of rate which is much lower rate the ordinary income . So if u do it right the sba loan is a great opportunity

Now I'm thinking if I should take the SBA loan🤔🤔🤔

The title should be the issue with debt consolidation. Not SBA loans

The only way i see this as a win is if she doesn't run the cards back up . The loan goes against her LLC and not her personal credit .so she clears alot off her credit report boosting her credit and lowering her payments allowing her to breathe for a while

30 years to pay off 20k 😮I paid off 20k in one year

$4500 income from being an artis, BS flag went up right there. Artists hardly make it. She’s getting money from another source. She needs a full time job to make that much. Or needs to hurry up and get married to someone that will financially save her.

those debt plans are just funding someone else's debt free life for the 30 years you just moved it to

I see why this is a personal finance channel and not an investment channel

30 years at $105/mo would've been $37,800 without including interest

Why not just accept the 1K grant and use it to for your business to make more money?

I'm confused what her motive for the call was.

The caller is 100% right.

I'm surprised she got a SBA loan, knowing so little about her own finances and income.

Now that he CC debt is cleared, she would be better off overall paying the minimum payments on the 4% SBA loan for 30 years and investing the $850 that has been freed up each month.

Why not paying $500 a month or more so she would be fine with low interest.

Wow, these two are simpletons. She made a savvy move by saving herself literally thousands on interest and they pretend that was the wrong move. Either simpletons or their like to manipulate the audience for financial gains.

She needs to get creative and use her talent to do things out of the box for a while, ie helping stage homes to sell (contact realtors or put ads on Craiglist etc), doing custom wall murals for home/business owners etc., teaching art in person or online (simple projects in small groups or one on one - look on YT for ideas) and too many other ideas to list. Brainstorm and burn up phone. Go outside comfort zone and think about using talent in other ways. Charge per project for custom work like murals/home staging. Still be an artist but side hustle until.. It’s not lowering standards and may even pick up clients primary artwork. A friend who’s an artist (started late 50s) makes good money by doing commissions incl custom bday/holiday cards. The wealthy will pay well for one-of-a-kind pieces and work. Aim higher. God luck to caller.

Lol, “yes please do”

From the title, they are t necessarily a bad idea. However asking Dave Ramsey if you should ever use a form of debt is only going to result in a “NO”

3 words if you are taking on debt: predictable cash flow

Was this woman in a daze or just high?

Good man 👍

The loan is not a problem, it is not a con. The problem is how people manage debt.

Without much time I was snake to get my SBA loan accepted ask me how

Really she's not doing to bad for her self. She just need to pay the same amount or 1k at min. When she is done add that 1k to her house payment.

🥴🥴🤦🏿‍♀️🤦🏿‍♀️🤦🏿‍♀️ Dave makes me sick 🤣🤣🤣🤣

Dave were is the pizza delivery rant 😂

This wasn't even about the SBA loan...

So obvious many of these calls are pre-set. Otherwise, the caller wouldn't have so much trouble answering questions.

Love this guy listen to him on the radio !!

How can I be SBA loan agent to make a money?

She could always fill out an application at mcdonalds

I highly doubt this woman was sober when she made this call.

100 dollars a month to pay 19000 for 30 years is the best deal ever!!! You can move out and pay 100 dollars less in rent , or pay. Less100 dollars a month with other things too. GREAT DEAL SORRY THESE GUYS ARE CRAZY!! THIS FIRST GIRL GOT A GRAT DEAL

.... If you get an SBA loan, you might not do the right thing, so you should DEFINITELY not do the right thing, and just pay all that interest anyways? What kind of hack advice is that? I’ve got some advice: Get the better loan, and the be responsible, continue to exercise self-control, and actually pay it off. 🤷🏻‍♂️

without watching this i know dr will say no😂

I disagree IF you put that money in a high interest business account u can make that money make money and use that to help pay that loan off

Can she write off the interest on an SBA?

Great personal finance guy. Not big business.

Isn't using an SBA loan to pay off random, unrelated credit cards a type of fraud?

Anyone need assistance with approval or grant??