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Ways to get a new business loan

Starting a unsecured start up business loans is exciting! But expensive! Start up business loans are considered high risk. Essential many banks stay away from them. But you don't want to start a business off under financed because you are almost guaranteed to be compelled out of business. Getting start up business loans is difficult and you ought to make sure that you have enough funding to get thru at LEAST six months to a year if your business produced $0 profits.
That means obtaining the working capital, staffing budget and equipment financing worked out in the beginning of starting your doors.
There are many types of start up business loans. Here are the most typical ways people financing their new business.
The SBA - the SBA program is where most new business start looking for financing. There are several SBA programs but the key 3 are the SBA 7A, SBA 504 and SBA 8a programs.
Additional apply for the SBA 7a program. It can the most frequent program. The SBA 504 program is used for large purchases like land, heavy equipment etc. The SBA 8a program is for minority run businesses and is very similar to the SBA 7a.
The SBA program is a bank guarantee. The SBA doesn't really issue loans. They work with banks and financial institutions nationwide. The guarantee makes certain the bank gets back up to 70% of the money they put out if you default. Essential most banks will request that you put down 30% as security. Thus making a SBA guaranteed loan to a new business relatively "safe".
To get approved for a SBA loan you should have good to excellent credit, be a homeowner, and possess about 30% of the amount you need available to use as a down payment.
When I used to work with a SBA loan lender, we would advise our new business owners to reserve the money they get from the SBA to use as working capital. We might get them the equipment they need by using an equipment rent. Why? Working capital loans are almost non-existent for a new business. You don't want to tie up all of your capital in equipment. You may need it later on to cover salaries.
What is an equipment lease?
A start up business equipment lease is relatively painless to have approved for. Unlike a SBA loan. You don't' have to have good credit. The down payment is generally 2 payments down. And they like that you can have experience in the industry.
How to get a start up business loan
You can begin with sites like Startupbusinessloans. com they work with a lot of different banks and are experts in helping start up businesses.
You can even go to your local bank and before you fill in any loan paperwork ask them if they finance start-up businesses. Certainly not everyone does and you don't want to have them pulling your credit if they won't be able to finance you.
A whole lot of start ups utilize personal credit cards and personal loans to get financing. As your business has no credit, you will need to be able to provide a personal guarantee in any case for any form of financing. The rates given to personal loans and personal bank cards are lower then what is given to begin up businesses IF and ONLY IF you have good credit. If you have bad personal credit the rates will be high and you may well not get approved.