How to Get a Small Business Loan

Many entrepreneurially-oriented people aspire to start a small business. Others already have a healthy business and are considering enlarging it. These folks have great ideas, strong motivation, and outstanding business acumen. They believe that if they focus on success, then a successful harvest will be theirs. Along the way, they may need an infusion of capital to propel the business forward. Over and over again, small-business loans have helped people achieve their dreams. Let’s take a closer look.

Small Business: An American Dream

Small business owners are the embodiment of the American dream. In general, people have a number of positive views about small business owners:

• Seen as honest and ethical
• Viewed as job creators
• Form the backbone of the middle class
• Are the stepping-stone to bigger enterprises

The government has long supported small business owners through policies, laws, and tax advantages. A number of government and other agencies exist to help small business owners, including the Small Business Association (SBA) and strong, community-oriented local banks.

Small Business

The SBA: Help for Small Businesses

Founded in 1953, the SBA provides loans and well as business counseling and contracting expertise to small businesses of all shapes and sizes. SBA loans come with low-interest rates, making them a great option for entrepreneurs just starting out. SBA loans can be acquired through a participating lender. The SBA guarantees the loan, which greatly reduces the risk to the lender. Because of this, they can be easier to obtain than other types of loans. SBA loans are often approved quickly as well.

Types of SBA Loans

There are many types of loans offered with an SBA guarantee. Some of the most popular are:

  • SBA 7(a) loans. These are the most popular of the SBA loan types. They can be used for a wide variety of needs, such as new construction, renovation, property purchase, equipment, infusion of working capital, and more. They are offered in amounts of up to $5,000,000.
  • SBA express loans. These are designed for fast approval, quickly putting needed funds in the hand of small business owners. They have recently garnered lots of attention and rival the 7 (a) loans in popularity. Loans of up to $500,000 are available.
  • SBA 504 loans. These loans are specifically designed to enable businesses to acquire fixed assets for expansion or modernization. Repayment periods are generous, up to 25 years in some cases. Like 7(a) loans, the maximum amount that can be borrowed is $5,000,000.
  • SBA microloans. Microloans up to $50,000 are offered through the SBA. They are made by non-profit, community-based organizations. They can be used for a wide variety of business needs, including refinancing.

In addition, the SBA offers disaster loans, loans for international trade, and for businesses that export abroad.

Southern States Bank is here to support small businesses owners striving to achieve their goals. They offer quality financial advice, a focus on customer service, and the trust in a local relationship that you want.