Small Business Owners Attracted to New SBA Microloans
One of the first questions that any small business owner has on their mind is, “Where can I get the small business loans I need to ensure that my endeavor is a success?” A great direction for intrepid small business owners to look in is SBA Microloans. For certain small business owners, these loans can help you get the capital needed to turn profit fast.
What is an SBA Microloan?
Finding the correct small business loans for your needs can be a challenge. An SBA Microloan is specifically targeted to business owners who have great credit and need less than $50,000 to get their dreams off the ground. If you are looking for more capital than this or if you have poor credit, you will need to look elsewhere.
However, if this sounds like it would work for your needs, an SBA microloan will give you between $500 and $50,000, provided you have the aforementioned good credit and a solid business plan. The money comes from an intermediary nonprofit.
SBA Microloans are great since these are some of the easiest sorts of loans to get. Some of them are even targeted toward certain groups, like minorities, veterans, and women.
Who is eligible for an SBA Microloan?
As said before, so long as you have a good credit score and don’t need more than $50,000 you are primed to receive an SBA microloan. Make sure that you read the fine-print when applying and that you are aware of any SBA Microloans that may target your specific demographic, particularly if you are a member of an underrepresented group in business.
Your business must be a for-profit business to qualify. However, non-profit child care centers are the one exception to this.
What are the pros and cons to an SBA Microloan?
One of the best things about SBA Microloans is how accessible they are. They are also very good for people who may have a limited credit history, like immigrants who are new to the US. They often have very flexible repayment periods and low interest compared to other small business loans available to entrepreneurs.
However, keep in mind that it may take several weeks to apply for an SBA Microloan. Additionally, they cannot be used to purchase real estate or debt refinancing. Plus, a lot of discretion is given to the nonprofit in charge of the loan.
While there are many options available to small business owners when it comes to getting capital, SBA Microloans should be seriously considered by any would-be entrepreneur.