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Since Massachusetts small businesses account for 1.5 million civil servants, it’s clear: Massachusetts entrepreneurs are a force to be reckoned with!

But that doesn’t mean they don’t need a little help sometimes. Small business financing can provide the help you need, whether it’s starting a new business or developing an existing one.

How a Small Business Loan Can Help Your Small Business in Massachusetts

Small business owners sometimes struggle unnecessarily during difficult times. They assume that they need to get started and do not want to take financial aid because they do not want to go into debt.

But there is such a thing as smart debt: if you take out a small business loan to invest in your company and then increase your income, you can easily get the loan back. This small amount you pay as interest can help create profits several times the amount you paid!

Massachusetts Small Business Loan Options

There is not just one type of small business loan for Massachusetts companies. With so many different options to choose from, there is sure to be one that suits your needs.

Bank loan

If you are looking for capital to grow your existing business and have excellent creditworthiness, financial institutions such as banks, credit unions and some online lenders provide low interest loans with long maturities.

SBA loan

The US Small Business Administration offers several low-interest loan programs, including 7 (a), SBA 504, SBA Express, and microloan programs. Find out more at SBA.gov

Credit line

If you prefer to have access to cash when you need it rather than getting a lump sum of cash right away, a line of credit gives you access to cash that you can borrow, repay, and borrow again.

Seller’s cash advance

If you do not have a good credit history, you can still qualify for merchant’s cash advancethat is an advance on future credit card sales. Your payouts are automatically debited from your credit and debit card transactions daily or weekly, plus processing fees.

Credit card

Business credit cards useful when you need to make commercial purchases such as stationery or gasoline for a company truck. You can add authorized users to your cards if you have employees who need to shop on behalf of the company.

Short term loan

Another option, if you have a bad credit history or your business is new and has not yet formed its credit history, is a short-term loan. They have high interest rates and short maturities, but they can bring you the cash you need in a pinch.

How to Get a Small Business Loan in Massachusetts

Lenders may differ slightly in what they require from loan applicants, but most will look at your personal and business credit scores to determine eligibility.

The higher your scores, the more good offers you apply for. If you do not have a business loan, find out how to open a loan to small business claim even more.

Other lenders, such as those offering short-term loans or cash loans to merchants, will consider not only the credit criteria, but also your annual income.

How to Apply for a Small Business Loan in Massachusetts

If you are applying for financing through an online lender, the loan application is likely to be fast and accurate. If you are applying for a bank or SBA loan, you may have to go to a branch to apply and you may need to provide documents such as a profit and loss statement as well as tax returns.

In any situation, you will be asked questions about your business, such as its name, industry, time in business, and annual income. You will also be prompted for personal information such as your address and social security number.

After applying for a loan and obtaining approval for the loan, you will be sent a loan agreement with the terms of the loan, including the interest rate, maximum loan amount and maturity date. After you sign the loan agreement, the funds will be credited to your bank account.

Small Business Resources to Help You Get Funding

If you’re applying for a loan that requires a business plan but don’t have one, Massachusetts has some great small business resources that can help you.

IN Small Business Development Center Network has offices in Boston, Amherst, Salem and many other cities and offers several technical assistance programs as well as seminars and assistance in public procurement.

IN Women’s Business League is another great resource for women entrepreneurs. It offers business events and courses.

Small Business Loan Usage 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 others, sees ups and downs throughout the year, access to a line of credit can ensure that you have the working capital to weather the downturns.

If you’re in the growth phase, you can benefit from a small amount of money to help you open a new location, hire employees, or place larger inventory orders.

A small business loan empowers you to help your existing business thrive.

This article was originally written on June 21, 2021.

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