Business Loans for the Struggling Business Owner
It has been noted that every month, thousands of businesses are formed in the country. For a business to success, it needs enough capital for its operations, and if you are one of these start up business owners, that is what you are looking for. There are start up businesses, expanding businesses, and businesses that are transferred to new owners that need business loans for the upkeep. There are business loans available for those struggling business owners who need funds to get their businesses on the go. Below are some of these start up loans.
This business financing are actually being offered by the Small Business Administration or SBA. SBA Loans do not directly come from the government, but they have commercial lending partners that grant these loans which are guaranteed by the SBA. This type of arrangement reduces the risk for both the lender and the borrower. The government sets the requirements for the loans and economic or policy changes, the terms of the loan can get affected. SBA loan forgiveness is available, whatever happens.
A start up business loan can be used in many ways. As we have already mentioned earlier, you can use business loans to start a business, buy a business, or expand your current one. Business loans are also necessary for construction, equipment, or buying real estate. Debt consolidation, or home or business repair after a disaster are the other uses of a business loan. These different uses of business loans have different requirements for down payments and collateral.
If you are a business owner, here are some of the business loans that you can take advantage of.
If you need working capital, want to buy estate, construct or renovate buildings or consolidate your debts, then you can use a 7(a) loan for these purposes. This business loan is very common and flexible. The maximum loan you can get for this type of loan is $5 million for 10 years for capital and 25 years for fixed assets.
Small loans are ideal for new or growing businesses. These types of loans are called microloans which are ideal for startup companies that only need loans of less than $50,000. It has a shorter repayment term of 6 years.
The CDC/504 loan program is for real estate and equipment loans which is a long-term, fixed rate financing. You can’t apply for this loan for working capital or inventory. The maximum loan amount is $5.5 million for a 10 or 20 year maturity term.
If you business has suffered due to a natural calamity, you can apply for disaster loans. A maximum loan of $2 million can be applied for to repair damaged real estate or equipment.