Let’s Talk Small Business Loans

Let’s Get Down to Business | Kristi Huynh

Small Business Loans: What’s The Big Deal?

Have you recently started a business venture of your own? Is it off to a bit of a rocky start? If so, I may have a helpful solution to help and get you back onto solid ground once more. What is that, you may ask? Exploring the option of small business loans that may fit your needs!

The very start of a new business venture is critical, because it can make or break your market credibility. Market credibility then goes on to potentially affect whether or not the business develops a solid customer base. Of course without a steady flow of loyal customers buying your product, a business is almost sentenced to fail without bringing in revenue. You also have to be able to afford to pay your staff! If you find yourself in this situation, it is possible to recover.  Not all hope is lost.

This is where the role of small government business loans come into play. Business loans can help to revive floundering business and give them another shot, by establishing credit as well as refinancing already existing debit. Small business loans can also be used in other cases than just financially speaking. Loans can also be applied to a number of uses, such as: Purchase of new equipment, machinery, parts, and supplies.

Now, let’s talk about the four available lending options offered by the Small Business Administration. The first is the loan guarantee program. Short but sweet, this program serves the purpose of helping small businesses to start or expand upon already existing services. As such, the amount allowed for borrowing on this loan is up to five million dollars.

The second program is called the Microloan Program. Like it’s given name, this loan is short-term, capped at fifty thousand dollars and used for considerably small  purchases such as office furniture or computers.

The third program is the 504 Fixed Asset Program, with a maximum loan amount of five million dollars. This program also features fixed-rate and long-term financing, and is particularly aimed at applicants whose business model will benefit their community directly, by providing jobs or bringing needed services to a historically underserved location.

Last but not least, we have disaster assistance. Under this specific program, loans are distributed with a low-interest but long-term plan in mind between the lending party and the receiver. This loan is meant to be put towards the restoration of a property to its original state after the event of a natural disaster (for example, in the event of a hurricane, tornado, or flood).

As you may see, there are a handful of different options out there that can help to serve the individual needs of your business. This has not been an all-inclusive list by any means, but it contains a mixed variety of loans that can be used for different purposes. However, in order to receive many of the loans mentioned above, one must have their own financial situation outside of the business squared away and in good standing. Good standing on a personal financial basis is of critical importance because it can make or break your chances for receiving a loan, as lenders can be hesitant to take the risk of lending to a start-up business.