You’ve thought about it for a long time, and you’re finally going to do it. You’re going to give your boss two weeks’ notice and be your own boss for a change. Now, you need to find out how to get a small business loan. It can’t be that hard, right? There are a ton of small businesses out there. Fortunately for you, the reality is that getting a small business loan is not unlike getting any other type of loan, but it takes research and effort.
Find Out What’s Out There
Getting a small business loan isn’t just about walking into your friendly, neighborhood bank and signing some paperwork. There are many types of loans available, and some are backed by the Small Business Administration (SBA), and some aren’t.
- SBA Loans – The SBA has many loans such as General 7A loans, microloans, and real estate loans. They are all backed by the SBA and, thus, entail the least risk for lending institutions.
- Personal Bank Loans – These are standard loans from a lending institution that aren’t backed by the SBA. They may require collateral and a large down payment.
- Alternative Sources – These can include credit cards and cash advances. They have a higher interest rate than other options but could be the best choice when other loans aren’t possible.
What You’ll Need
When you apply for any small business loan, there are some things you’re going to need in order to be approved. For bank and SBA loans, you’re going to need good credit unless you’re willing to pay high interest rates. You also need a well-researched and thorough business plan that includes not only how your business is going to function, but also how you plan on paying the loan back, financial projections, and an analysis of your competition.
You Better Shop Around
It’s never a good idea to simply pick a place to use for your loan needs without thorough research. There are hundreds of banks and other lending institutions out there that provide loans for small businesses. The key is finding the right one for you. Some will have great interest rates, but a big balloon payment, and others will have so-so interest rates, but better loan terms.
Become your own boss today. Call us at 888-788-6456 or fill out our online form to start the funding process.