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Small business owners in Baton Rouge, Lafayette, Shreveport, New Orleans and dozens of other Louisiana cities cannot always go it alone. They need resources to support them in starting, building and growing their business. Whether it’s business courses from Louisiana Economic Development (LED)By getting a mentor from a Small Business Development Center or applying for funding, they are doing everything they can to be successful.

How a Small Business Loan Can Help You in Louisiana

So why take out a small business loan? Even if you have money in the bank, having access to more working capital for your business needs can ensure that you never experience a monetary crisis.

If the opportunity presented itself to buy a competitor’s business, would you have enough money to do so? Otherwise, a loan can help.

How has the COVID-19 pandemic affected your business? You may need a little leeway to get back on track.

Even having some breathing room to pay bills for a few weeks can make your business easier. As you can see, small business financing can solve a lot of headaches.

Louisiana Small Business Loan Options

There are many types of financial institutions, both online and traditional, that offer loan solutions for your business.

Loans for the coronavirus pandemic

Where would we be in the aftermath of the coronavirus pandemic if it weren’t for local and federal lending programs like Payroll Protection and Economic Loss Disaster Loans? It’s scary to think.

While the SBA does not currently approve new PPP loans, we will keep you informed if this changes.

Check for local coronavirus resources at Louisiana Economic Development Website

Bank loans

When you think about small business loans, you are probably thinking about going to a bank where you already do business. This can be a great solution if you have a good credit history, but don’t limit yourself to just going to your bank.

SBA Loans

Another option is a loan offered through the US Small Business Administration. These loans are known for their low interest rate and long maturity, making them ideal for businesses looking to raise funds to grow over time. The most popular SBA loan is 7 (a), which can be used for various business expenses. There is also a 504 loan that can be used to purchase equipment and real estate.

Credit lines

Not every business needs a large amount of cash right away, especially since you have to start paying off that loan immediately! A line of credit is a good option when you want to get some cash now and more later without taking out another loan.

Trade credit

If you regularly buy inventory or supplies from certain vendors, consider asking them if you can open a merchant credit account. This allows you to pay bills over a period of time, usually a net 30, so you can better manage your cash flow.

Credit cards

Although they often come with great interest, business credit cards it can be helpful to have it on hand, especially if you have employees who need to shop on behalf of your company. Just make sure that you have paid your balance in full to avoid this interest.

Seller’s cash advance

If you accept debit and credit cards, a cash advance to the merchant will provide you with, you guessed it, a cash advance on future credit card sales. To repay the advance and commission, daily or weekly payments are automatically deducted from your transactions.

How do I get a small business loan in Louisiana?

The higher your credit rating, the better the repayment terms you are applying for and the more options you will have. If you have excellent credit, look for a loan from a bank or SBA.

If this is not so good, then a cash advance to the merchant or a short-term loan may be the best option. These decisions take into account factors other than your credit, such as your income or daily trading transactions.

If you are working on how to create a business loan, close the sales line that reports to the credit bureaus so that your timely payments help you improve your credit score.

How to get a small business loan in Louisiana?

Loan applications for small business loans may vary slightly depending on the requirements of your lender. It’s a good idea to think ahead about what you need to provide to make the process go smoothly.

You will be offered information about your business, including:

  • Where is it
  • How long has it been in business
  • Your employer identification number
  • Annual income

You will also need to provide personal information such as social security number and contact information.

After you receive approval, you will be given a loan agreement to review the details of the terms of the loan. If you agree, sign the agreement and your funds will be credited to your bank account in just one business day.

Who is Eligible for SBA Loans in Louisiana?

If you are considering financing through the Small Business Administration, make sure you are eligible for a loan. Some SBA loans have specific requirements, such as what you can use the funds for or what type of business you do.

But generally, your business must be commercial and must be doing business (or planning to do business) in or within the United States. You must have a reasonable equity capital to invest in and must have already looked for other financial resources, including personal assets.

How to get a loan to start a business in Louisiana

Louisiana is a great place to start a business. Take advantage of the financing options available to you to make your dreams come true.

This article was originally written on June 15, 2021.

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