When you're starting a business there's nothing more important than capital. You need money to buy the equipment needed to run your company as well as the funding to get the inventory that is requested by your clients. A great way for you to get your hands on a lump sum of cash is to receive a loan from the Small Business Administration (SBA.) The SBA is a government entity that is all about supporting entrepreneurs that are trying to get a business off the ground. Instead of applying with a number of other lenders, find out why your first stop for a loan should be with the SBA for a small business loan.
The SBA Offers Better Interest Rates
It's hard to get a good interest rate the first time you apply for a small business loan. Because you're just starting out, you don't have a successful track record behind you that the lender can look at to see how much of a risk you are. All they can go off of is your personal credit history, which may or may not be in stellar condition. The bank may worry that if your business doesn't do well and you're not seeing the profits that you thought you would achieve, you might decide to default on the loan.
Getting a loan through the SBA is a different animal altogether. These loans are backed by the federal government. This installs an added layer of protection so that even if you happen to stop making your loan payments, the SBA can recoup the lost funds from the government.
SBA Loans Offer Longer Repayment Periods
The longer you have to repay the loan, the lower your payment will be. The last thing you need to worry about when you are first starting out is having to make a huge loan payment each month. It takes away from the money you have available to take care of the needs of the business.
The SBA will usually offer much longer repayment periods than what you will find with conventional lenders. You can look forward to keeping more of your profits so you can take your company to higher heights.
Working with the SBA is a great way to get the money you need to fund the business that you want to create. Take advantage of all of the resources that they have to offer and you'll be ready for success.