Upon the birth of your business, you started picturing what your business would look like as it grew, including How it would expand, the sort of people you’d employ, how you’d manage HR, how you would allocate funds, and how you’d satisfy your customers’ needs more readily than ever before. Thus, when it comes time for business expansion, you’re excited and ready to search out the best way to do it. As always, Patriot Commercial Lending Solutions is here to help you make that expansion happen to your standards.
There are many ways to go about expanding your business. Either way you slice it, you’ll need money to start expanding your business, and some types of financing will certainly serve you better than others in terms of expanding your business intelligently. Thus, we’ve broken down the best loans for your business expansion voyage.
What is an SBA Loans
An SBA is a government-guaranteed, long-term funding option created by the SBA, or Small Business Administration. This option allows for approved lenders like us can offer low-interest rate funding to businesses that might have otherwise been turned down by a bank. This funding can, conveniently, be used for any sort of business purpose, including small business expansion.
Since expansion is what you have your eye on, you should know that there are two types of SBAs to consider. One for larger borrowing rings in at $5 million and the smaller one round out at about $350,000. Both can be used for small business expansion, which renders these loans as ideal choices for most small businesses. If you’re looking to expand immediately, however, you might turn your eye to another kind of loan, as the application process could take weeks. Another potential drawback on these kinds of loans is that you need fairly good credit to begin pursuing them, the expected credit score is around 650 and up. The loans can drop as low as $5,000 and the term can run anywhere from five years to 25 years. The interest rates start at around 6.5% and the acquisition of the loan can take as little as three weeks, but can take much longer in some cases.
Through equipment financing, the lender will give you cash to order the equipment and then require that you pay back the total amount they lent to you, plus fees for a predetermined period of time. This loan is much easier to obtain because the equipment you purchase will act as collateral for the loan. The term of the loan will stretch through the expected life of the equipment and the interest rate is around eight percent to 30 percent.
With this type of loan, you get a loan with a set maximum amount of capital that you could draw from at any time. Just like a credit card, you only pay interest on the amount you use. The loan amount can range from $10,000 to $1 million and the term is anywhere from six months to five years. With this kind of loan, you’ll be looking at interest rates around seven to 25 percent.
If you’re interested in pursuing small business expansion, Patriot Commercial Lending Solutions can offer all of these top-notch loans to anyone in the Dallas and Abilene areas. Feel free to contact us if you have any questions.