Small Business Loans

If you are a small business owner you have probably dealt with the challenge of trying to secure financing for your business. Many small business owners struggle to acquire the financing they need because lenders have tightened their lending restrictions and they are no longer offering financing to just anyone. Due to the recession, small business loans are hard to come by, no matter how great your credit may be. So where can you turn when you are looking for small business loans?

Banks and credit unions are usually the standard places to check when you need a small business loan, but you also need to branch out and start applying to online lenders. Many of the online lenders have a little more flexibility when it comes to small business loans and they can easily provide you with the financing you need in a short amount of time. The lender will consider the following information when they are deciding if you are worthy to receive small business loans:

• Your personal credit
• Your business credit
• Work or industry experience
• Business plan including product information and future financial outlook
• Collateral to secure the loan

After the lender reviews your information, they will provide you with an answer pertaining to small business loans in a short amount of time. Typically you will have an answer in 24 hours or less. There are a few small business loans that are available, here are a few that you may want to consider:

1. SBA guaranteed loan. This loan is meant for small business owners that are just getting started. The SBA offers money to small business owners in order to try and stimulate the economy and create jobs. The SBA loan can also be used if you would like to expand your small business. The SBA loans only allow you to borrow up to $2 million to get your business started. You are guaranteed 75 percent of the loan amount, which requires you to invest some of your own money or assets into the business. To receive this loan you must have a high credit rating and meet the criteria of the SBA. The SBA has specialty loans that you may qualify for depending on your gender and race.
2. Micro-loan. Start-up businesses often use micro-loans and return to them later on to purchase equipment and other things. A micro-loan allows funding up to $35,000. You will need to fill out the application and await the decision by the intermediary who will decide if you have a solid business plan that will become successful.
3. CDC loan. The Certified development company loan is great for a small business that would like to expand. You will receive financing at a fixed rate that allows you to purchase equipment and assets for the business. You must have some equity with you in order to secure the loan.

These are the commonly used loans when you are starting or expanding a small business. There are other small business loans you can use to repair your cash flow or to purchase raw materials. These loans, called unsecured or secured loans, usually have a higher interest rate and they do not have flexibility like you will receive with other small business loans. Any time you are asked to front collateral for a loan, you need to be extremely careful. When you are fronting collateral you are allowing the lender to have possession of your property in the event that you default on the loan. Try to separate your business affairs and your personal affairs so you don't lose your home if the business fails.

Corporate Credit Concepts specializes in small business loans. For more information about small business loans and how it might benefit your business, please CLICK HERE for a free phone consultation.

Back to Directory