Getting from A to B
Today’s small business owners often find themselves in a Catch-22.
You need capital to increase production, open a storefront, or invest in equipment and employees to help your business grow. Those are worthy investments. However, you may not have enough cash on hand to do those things outright. And without that expansion or investment, your business is unlikely to increase profits.
Small business loans are designed to address these capital shortfalls. They help business owners get from point A to point B, loaning the cash that’s needed to get things off the ground or to the next level.
Different business owners all have different needs, so it’s no surprise there are a variety of loan types available. Owners can pursue traditional term loans, business lines of credit, equipment loans, and more. One attractive loan option for many small business owners is the classic SBA loan.
The Nitty Gritty
“SBA loans” is a misleading term. The Small Business Administration doesn’t actually loan the money out themselves. Instead, the agency backs business loans issued by traditional banks.
This backing (usually 85% of the loan value) means the bank is guaranteed to get most of their money back in case of default, so lenders feel more comfortable extending credit.
According to NerdWallet, the average SBA loan size is $371,000, although they can vary between $5,000 and $5 million.
Meet Springfield’s Top 5
In celebration of Springfield Small Business Week we’ve rounded up Springfield’s top 5 SBA loan lenders based on their FY17 lending activity.