Business loans can be used for a variety of purposes. Proceeds of the loan may go into:
* Purchase of real estate for housing the enterprise
* Improvements on the property, i.e. construction, renovation or * * leasehold improvements
* Purchase of furniture, fixtures, machinery and hardware
* Working capital
* Inventory
Capital is the lifeblood of entrepreneurship. Without an adequate source of capital, an enterprise may have to suffer and can fail. Small business loans can be available at many banks and lenders, however the lender may only render approval to the loan if the company satisfies some criteria. Each lender will have different criteria. When you apply for business loans, you should be aware of these criteria and whether you and your company satisfy them otherwise you may be rejected and denied the loan. Some lenders require that your business credit scores are good. Before application, you should check your own business scores and ask the lender what their required scores are. Another loan provider might require that all those who own 20% and more of the company must have personal credit scores of 680 and above. If you are aware of these criteria you may be less likely to be denied your required business loans. The reason for you to not keep on randomly approaching lenders for business loans, is that once 3 or more lenders have run personal and business credit checks on you, the lenders you go to after that will most likely deny your approval for the simple reason that three lenders have checked on your credit scores before them.
The different types of loans available for business include:
* Micro Loan: amounting to $5000-$35,000 that can be used for any commercial purpose
* SBA Loans: Loans granted to small businesses from Private sector banks that are guaranteed by the SBA.
* Franchise Financing: Reserved specialized resources for financing recognized, mostly nationally known franchises.
* Development Financing: Loans for small business to acquire major fixed assets like land and building. These loans are long-term, fixed rate.
* Import Export Loans: Programs for export financing of US goods and services through a range of loan, guarantee and insurance programs.
Some government loans are especially available to particular categories like those businesses owned by women, minorities, persons with disabilities, veterans and those serving in the US military. Be aware of the resources available to you if you need business loans. St. Cloud, MN residents can avail the programs under SBA that can help them grow their company.
