Owning and running a small business usually means that your budget is stretched thin. This can sometimes mean that there is not enough funding to expand or modernize your company and your opportunities vanish. With the help of SBA Loans, you can secure the funding you need for your business and take advantage of the opportunity to grow and update your equipment. To get this type of loan, you will first want to know what type of loan it is and where you can go to get one. You will also want to know what type of collateral is used to secure the loan and what documentation you need for the application process.
What Are 504 Loans?
There are several types of SBA Loans which can help your business and each type will have specific businesses that it helps as well as unique qualifications to get the loan. One thing to keep in mind is that the Small Business Administration in the United States is not typically a lending institution. Instead, the SBA can guarantee loans offered by banks and other lenders. A 504 Loan through the SBA is also called a Certified Development Company loan and is typically granted for businesses looking to expand their operations or to modernize equipment and techniques.
Where Can You Get Them?
SBA Loans can be easier to find and secure than you might think. By doing a quick internet search you can find ways to apply online or through local institutions. This type of funding typically includes a small percentage from the borrower, a large portion through a local lender and the rest through a Certified Development Company. This means that you will need to have some funds to contribute to the project as well as pitch the project to investors. The good news is that getting a brick-and-mortar location, or modernizing your equipment, is typically seen as a good investment for companies which already have a strong client base. For example, if your internet-based company is doing well enough that you need the extra storage and work space provided by a brick-and-mortar location, then you are likely to find funding easier than someone with an idea and no established customers.
SBA Loans can help your business get established, grow and even modernize. There are several different types of loans guaranteed by the Small Business Administration including the 504 or Certified Development Company loans. When you are looking for a CDC loan it is important to remember that having a down payment and a solid customer base will help you get approved easier than going in unprepared.