.png#keepProtocol)
Table of Contents
Small Business Loans to Apply For Today
If you’re willing and able to invest in your business’s future, take a look at these government and private small business loans below.
- U.S. Small Business Administration SBA 7(a) loans
- U.S. Small Business Administration 504 loans
- U.S. Small Business Administration Microloans
- Bank of America Business Advantage Unsecured Term Loan
- Wells Fargo BusinessLine Line of Credit
- Fundbox Line of Credit
1. U.S. Small Business Administration SBA 7(a) loans
- For: Small businesses
- Amount: Up to $5,00,000
- Min. credit score: 625
The U.S. Small Business Administration offers a variety of flexible loans to small businesses, all with competitive terms comparable to non-guaranteed loans. Its primary program – the 7(a) loan program – lends businesses up to $5 million. Funds can be used for a variety of purposes including acquiring real estate, purchasing furniture or equipment, and refinancing current debt.
Funding can be available as a term loan or can be used as a line of credit. Since this loan is backed by the government, it offers generous interest rates of 11.50-15.00%. However, businesses typically need to offer collateral to secure the loan.
2. U.S. Small Business Administration 504 loans
- For: Small businesses
- Amount: Up to $5,50,000
- Min. credit score: 680
504 loans are another financing option provided by The U.S. Small Business Administration. Its maximum funding amount sits slightly higher at $5.5 million, and certain energy projects are eligible to receive loans for up to three projects (capping at $16.5 million in total).
Unlike the 7(a) loan, however, the 504 has fixed interest rates pegged to US treasury bonds, providing businesses with a degree of predictability. Its use case will be similar to the 7(a) loan, but due to its slightly larger lending potential, this loan is best suited for bigger investments like real estate purchases, property renovation, and construction projects.
3. U.S. Small Business Administration Microloans
- For: Small businesses
- Amount: Up to $50,000
- Min. credit score: 620
If you don’t need financial financing, the U.S. Small Business Administration also offers government-backed microloans. The loan is eligible for small businesses and certain not-for-profit childcare centers, and while the funding amount goes up to $50,000, its average size is around $13,000.
Due to its lower lending cap, businesses with a slightly lower credit score of 620 can be eligible for the loan. Microloans are ideal for businesses looking to rebuild, repair, or enhance their business by investing in assets like inventory, supplies, or furniture.
4. Bank of America Business Advantage Unsecured Term Loan
- For: Small businesses
- Amount: Undisclosed
- Min credit score: 670
If you don’t qualify for government-backed loans and are willing to repay slightly higher interest rates, it could be a good idea to pursue small business private back loans. For those considering this financing option – Bank of America will be a good place to start.
Bank of America offers the most commercial and industrial loans out of any bank in the U.S. Its maximum loan size of $100,000 may shy in comparison to funding offered by the U.S. Small Business Administration, but the lenders competitive interest rates and flexible repayment terms still make it a great option, especially if you’re an existing Bank of America customer.
5. Wells Fargo BusinessLine Line of Credit
- For: Small businesses
- Amount: Up to $150,000
- Min credit score: 680
Popular US bank Wells Fargo also offers a small business financing option called a Business Line of credit. The size of loans ranges between $10,000 to $150,000, and new Wells Fargo customers don’t have to pay an annual fee for the first year.
Wells Fargo’s Line of Credit charges reasonable interest rates of 10.25-18.25%, and because it’s a revolving credit line, the type of financing isn’t subject to an annual review. However, because no collateral is required for the loan, businesses will need to have a credit score of at least 680 to apply and will need to have been in business for at least two years.
6. Fundbox Line of Credit
- For: Small businesses
- Amount: Up to $150,000
- Min credit score: 600
Fundbox line of credit is another form of private financing that businesses can use to invest in their future. Unlike government-backed loans, this loan can be approved within a day of applying, making it ideal for businesses looking to cover emergency costs.
Its application process is quick and straightforward too, and its low minimum credit score requirement is great for businesses with poor credit scores that have been denied from other business loans. These perks come with a catch, though. Fundbox’s line of credit charges interest rates of anywhere between 36.00-99.00%, which is a steep charge compared with traditional banks.
Small business loans can be an excellent way to invest in your business and safeguard its future, especially if you can’t qualify for private grant programs. However, it’s important to be aware that every type of lending can incur risks, even with government-based loans.
If you secure your loan with a personal guarantee, your personal assets could be at risk if you fail to meet repayment deadlines. Taking on too much debt could impact your credit score as well, which could make it harder to access financing down the line.
For these reasons, it is always worth cutting back where possible, like by utilizing free and low-cost software solutions, before incurring future debts with government-backed or private loans.
.png#keepProtocol "The Key to Boosting Retention")
More Stories
The Key to Boosting Retention
Kim Jong Un Unveils Ambitious ‘Regional Development Policy’ To Modernize Rural North Korea Amid Food Shortages
Industry Leader Revolutionizes Business Financing Through Credit Stacking