How to Get a Small Business Loan
with the Alliant Business Systems Business Lending Network
Cash flow is the lifeblood of any small business. It helps you weather changes in customer tastes, market downturns, or supply chain problems. It even helps you respond to unexpected opportunities like seasonal business surges, the chance to hire new workers, or the ability to open new locations.
Alliant Business Systems give small business borrowers access to lenders with the best small business funding options. Here, we explore the different types of small business loans available to your business.
Get Access to Business Funding For Your Small Business
The U.S. Small Business Administration is many borrowers’ first choice because of the robust support it offers small businesses. Its learning center, local incubators, and a number of other support services are augmented by loans issued through local banks and backed by the United States government.
However, these loans — which include microloans, SBA 7(a) loans, and the CDC/504 loan program — are difficult to get. Even though small business lending is on the upswing, an estimated 51% of SBA loans are rejected. Furthermore, some types of businesses, like startups and businesses that have less than two years in operation, find it even more difficult to qualify.
Leasing equipment can be attractive to cash-strapped small businesses, but the cost of a lease or rental can often lead to the realization that buying would have been the better — and cheaper — option. Whether you’re a restaurateur investing in POS equipment, a photographer upgrading her gear, or a landscaper eyeing a Bobcat and backhoe loader to take on bigger jobs, equipment financing gives you the money to purchase that equipment outright.
|Business Lines of Credit
With a business line of credit, lenders will establish a credit limit for a maximum amount of money they will lend you. You can draw as much as you need up to your limit and like a credit card; you pay interest only on the amount you borrow. Business Lines of Credit can help bridge the gap during seasonal lulls and other lean periods. A business line of credit can ensure that you always have the capital you need when you need it.
|Business Acquisition Loans
There are a number of scenarios where a business acquisition loan might be in the cards. You might want to purchase or expand a franchised business or consolidate a partnership, for instance. In other cases, you may find it makes more business sense to buy an existing business to incorporate its assets or intellectual property into your own business rather than trying to build those assets or IP from the ground up.
|Merchant Cash Advance
Instead of putting up collateral, a merchant cash advance allows you to borrow against your daily or weekly credit card sales. This often involves smaller loans (and can also mean paying a higher APR), but can be a good fit under some circumstances.
|Unsecured Business Loans
While many business loans require the borrower to pledge company assets as collateral, this is not the case with an unsecured business loan. This comes with a significant catch: the rates and fees, reflected in the loan’s APR, will be higher than usual. You will also be required to personally guarantee repayment.
Navigating the Challenges of Small Business Financing
Each type of small business financing presents its own challenges and opportunities. Not all financing types will be the right fit for your business, and even the same business may find itself exploring different types of financing at different points in its lifecycle. Further complicating matters, each has its own requirements, qualifications, application processes, repayment terms, and fine print. That can make it intimidating for the uninitiated.
Choosing the right financing for your small business can be difficult, but is not insurmountable. Alliant Business Systems has years’ worth of experience helping businesses build their credit in order to match them with the best finance options available. See how we can help your business today.