Massachusetts Small Business Representative 1.5 million government employees, it’s clear: Massachusetts entrepreneurs are a force to be reckoned with!
But that doesn’t mean they sometimes don’t need a little help. Whether it’s starting a new business or expanding an existing one, small business financing can give them the help they need.
How a Small Business Loan Can Help Your Massachusetts Small Business
Small business owners sometimes struggle needlessly during tough times. They assume they need to start and are reluctant to take financial aid because they don’t want to go into debt.
But there is smart debt: If you take out a small business loan to invest in your business and then increase your income, you can easily pay off the loan. This small amount that you pay in interest can help generate profits many times more than what you paid!
Options for Small Business Loans in Massachusetts
There is not just one type of small business loan for Massachusetts businesses. With so many diverse options, there is certainly one that fits your needs.
If you are looking for capital to grow your established business and have great credit, financial institutions like banks, credit unions, and some online lenders offer low interest term loans with long repayment periods.
The US Small Business Administration offers several low interest loan programs, including 7 (a), SBA 504, SBA Express, and Microcredit programs. Learn more about SBA.gov.
If you’d rather have access to cash when you need it rather than receive a lump sum all at once, a business line of credit gives you access to cash that you can borrow, repay, and borrow again.
Merchant cash advance
If you don’t have good credit, you may still be eligible for a merchant cash advance, which is an advance on future credit card sales. Your refunds are automatically deducted from your credit and debit card transactions, daily or weekly, plus an origination fee.
Business credit cards are useful when you need to make business purchases like office supplies or gasoline for the business truck. You can add authorized users to your cards if you have employees who need to make purchases on behalf of the business.
Short term loan
Another option if your credit is poor or if your business is new and has not yet established a credit history is a short term loan. These have high interest rates and short repayment periods, but they can get you the cash you need in no time.
How To Qualify For A Small Business Loan In Massachusetts
Lenders may vary slightly in their requirements for loan applicants, but most will look at your personal and professional credit scores to determine eligibility.
The higher your scores, the more you will qualify for good offers. If you haven’t established business credit, learn how to set up small business credit to get even more.
Other lenders, such as those who offer short-term loans or cash advances to merchants, will look at criteria other than credit, such as your annual income.
How to Apply for a Small Business Loan in Massachusetts
If you are applying for financing from a lender online, there is a good chance that the loan application will be quick and accurate. If you are applying for a bank or SBA loan, you may need to visit a branch to apply and you may be required to provide documents such as your profit and loss statement as well as income tax returns.
In either case, you will be asked questions about your business, such as its name, industry, time spent in business, and annual revenue. You will also be asked for personal information, such as your address and social security number.
After you submit your loan application and have been approved for a loan, you will receive a loan agreement with the terms of the loan, including the interest rate, maximum loan amount, and repayment period. After signing the loan agreement, the funds will be deposited into your bank account.
Small Business Resources to Help You Get Financing
If you’re applying for a loan that requires a business plan and you don’t have one, there are several great resources for small businesses in Massachusetts to help you.
the Small Business Development Center Network has offices in Boston, Amherst, Salem and many other cities, and offers several technical assistance programs as well as workshops and government procurement assistance.
the League of Business Women is another great resource if you are a female entrepreneur. It offers business related events and courses.
Uses for a small business loan in Massachusetts
So how can you, as a Massachusetts business owner, use small business loans? There are so many ways!
If your business, like many, experiences highs and lows throughout the year, having access to a line of credit could ensure you have working capital to weather downturns.
If you are in a growth phase, you might benefit from a little extra cash to help you open a new location, hire employees, or place larger inventory orders.
A small business loan gives you the opportunity to help your existing business flourish.
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