financing for small businesses

Everything You Need to Know About Financing for Small Businesses

First Financial SBA Loan, Starting a Business

If you’re a small business owner – or about to be – you already know that this job title involves wearing countless hats and juggling just as many priorities.

In short, being an owner can be one of the most rewarding jobs in the world, but it’s definitely not without its challenges.

Financing for small businesses continues to be a hot topic because, among those challenges, this remains one of the most pervasive.

Financing for Small Businesses Is as Easy as One Simple Loan

Fortunately, the truth is that financing for small businesses doesn’t have to be as complicated as it often seems. In fact, for the vast majority of owners, an SBA loan is the simple solution.

Small Business Administration loans come with a number of benefits that commercial options can’t match. Here are just three of these advantages.

1. Federal Backing

As the name suggests, these loans are backed by the Small Business Administration, a federal agency. This means business owners can have the utmost confidence in the source of their funding.

2. Greater Flexibility

That federal backing also means that the agency can be much more flexible with their terms. If you’ve already looked into commercial loans for small businesses, you’ve seen how rigid the terms can be. While that may “work” for some owners, most will be forced into accepting less-than-ideal stipulations and may not even get the total amount they need.

You have three main options with SBA loans:

  • 7(a) Loans – This includes financing for a wide range of general business needs. Loan maturities can last for up to 10 years for working capital and 25 for fixed assets.
  • 504 Loans – This is a great option for long-term, fixed-rate financing if you’re looking to improve your current business. These loans are processed through CDCs (Certified Development Companies) that take an active interest in growing their local economies.
  • Microloan Programs – These loans were created for financing smaller business investments (e.g. inventory, working capital, machinery, supplies, furniture, etc.). They are facilitated by intermediary lenders that specialize in helping small businesses.

SBA loans offer some of the lowest annual percentage rates among funding options, too, making them all the more attractive for owners who need financing.

3. Predictable Payment Structures

Financing for small businesses often involves a number of surprises. Accounting can quickly become a convoluted nightmare and, if nothing else, take all the fun out of the “dream job” of being your own boss.

Taking out an SBA loan means not having to worry about those dreaded balloon payments. Their longer terms and extended amortization schedules make it much easier for small business owners to improve their cash flow, which is a huge benefit, especially when you’re just starting out.

Using an SBA Express Loan to Finance Your Small Business

If learning about how simple financing for small businesses is all you need to begin investing in your dreams, consider an SBA Express loan. You can take out as much as $150,000 without putting down any personal collateral. Contact us today to learn more about how this specific type of SBA loan can finance your small business.