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How Can I Get a Loan to Start My Business?

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Question: How Can I Get a Loan to Start My Business?

How to Get a Loan to Start or Expand a Business

Are banks still making business loans? This is probably the question of the year. While it is true that banks are more hesitant to loan money, the Small Business Administration (SBA) is giving them more incentive to lend, with higher guarantees (up to 90%) and other support.

Remember that banks make their money by lending, so they want to lend; your job is to make it easy for them to lend to you. Here are some ways to find a bank or other lender that might be receptive to your loan request:

Answer:

SBA Preferred/Certified Lenders
Look at the list of Small Business Administration Preferred and Certified Lenders. These lenders work with the SBA regularly and they can help you with SBA loans.

Local SBA Office Go to your local SBA office directly and see what they say about your options. They may recommend a bank to you.

State Business Development Office Check on the website of your state's office of business development (search on [state name] and "business development." Some states have funds available for certain individuals (women, minorities, veterans, disabled) starting businesses. They also may have funds to help you start a business in certain targeted development areas, like disaster zones or low-income areas.

Check Local Banks You can always take your business plan from bank to bank. Take it in person and talk to the loan officer and explain your situation. Local banks usually are more receptive than the larger national banks.

Try a Credit Union
Although credit unions have some restrictions on the amounts they can lend, they typically tend to lend smaller amounts to small businesses, so you won't have to compete with the larger companies for loans. Credit unions also work with the SBA to grant 7(a) loans.

It's tough to get funds in this crazy economic time, but it can be done. Persistence, patience, and a willingness to comply with requirements are what you need.

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