Comparing Business Loan Options

Set the course for your small business and enjoy the financing you need to overcome startup obstacles. The Small Business Administration has a number of loan programs for small businesses that may not have access to other financing options. Compare the most common SBA loan options to see how you may be able to grow your business the right way.

SBA 7(a) Loans

The most common SBA option is the 7(a) loan. This loan program gives you a long-term loan that you can use for a number of reasons. The biggest benefit of the 7(a) program is that you can use it to cover operating expenses, invest in real estate, repair equipment or take on any other financial issues you may be having with your company.

Loans through the SBA require you to apply to both the SBA and to a participating lending institution. This application process doesn’t just look at your business credit score and history, like traditional business loans, but takes other information into account as well. The loans are partially backed by the Small Business Administration, so your lender is more willing to work with your business. A less-than-ideal credit score or short financial history won’t prevent you from moving forward with competitive financing.

SBA CDC/504 Loans

A more specialized SBA program is the CDC/504 loans. This lending program is specifically designed to offer small businesses the financing they need for securing real estate or equipment. Your application will need to include information about the specific property or machinery your company needs, and you’ll need to use your loan exclusively to invest in this particular asset.

Disaster Loans, Microloans and More

There are many other SBA loan programs to consider in particular situations. A microloan gives you a short-term boost of cash for a particular project or small financial need. Disaster loans are exclusively for companies that are affected by a particular disaster. Discuss your needs with a participating financing institution to see if you qualify for one of these more specialized SBA programs.

SBA financing is typically competitive with other business loan options, but they can be easier for small businesses to obtain. Explore the many different SBA programs to find one that fits your current business situation. Grow your company, expand your client base and offer better products and services with SBA loans that fit your industry and your financial needs.