Commerce in the State of Maryland consists of 99.5% small businesses. Half of all state employees, from Baltimore to Annapolis, work for small businesses. It is therefore important that these business owners have access to working capital that helps them maintain the strength of these businesses.
Small Business Loans for Maryland Business Owners
Entrepreneurs don’t always have the cash to buy what they need to keep operating. In your business, would you be able to replace a piece of equipment like a computer or a company vehicle with money? Otherwise, you are far from alone.
Small business financing solutions like the ones we’ll discuss below can give you peace of mind knowing you can cover any expenses that arise, no matter what’s in your bank account.
Options for Small Business Loans in Maryland
Each of the following business financing solutions is ideal for specific situations. Decide what is right for you.
Coronavirus Pandemic Loans
In addition to federal COVID-19 emergency relief loan funds designed to help businesses nationwide recover from financial losses caused by the coronavirus pandemic, including the Paycheck Protection Program (PPP) and Economic Disaster Loans (EIDL), there were also COVID Programs for Small Businesses in Maryland offered by the Maryland Department of Commerce and other entities.
Note that these programs may no longer be available.
Banks, credit unions, and online lenders offer small business loans with competitive rates and longer terms to businesses with excellent credit.
The United States Small Business Administration (SBA) offers low-interest loans that can be used for a variety of purposes. For more information on the different loan programs, visit SBA.gov.
Lines of credit
When you need working capital, sometimes you don’t need it all at once. This is where a line of credit can come in handy: you’re approved for a certain amount, which you can borrow and repay, then borrow again.
If you use expensive equipment in your Maryland business, an equipment loan is worth exploring. Even if you don’t have good credit, you can still qualify for lower interest rates because the equipment you buy serves as collateral for the loan.
Short term loan
Even if you have bad credit, there are financing options. Short-term loans usually have to be repaid within a few months or a year and may have higher interest rates.
Using business credit cards to make purchases for your business, especially a card that allows you to accumulate points to redeem for rewards, can be a smart move for your business. Some have high interest rates, so be sure to pay off your balance before these charges kick in.
How to Qualify for a Maryland Small Business Loan
Lenders look at several factors to determine eligibility for financial assistance. If you’re running a startup, you may not be eligible for certain options, such as a bank loan or SBA, as these typically want borrowers to have been in business for at least two years.
Your credit will also be taken into account: the higher your personal and/or business credit ratings, the better offers you will get. Learn how to establish business credit to expand your options.
Lenders can also look at your annual income and determine if you have taken out loans before. Essentially, they will determine how much risk you present to them in terms of being able to repay a loan.
How to Apply for a Maryland Small Business Loan
Before applying for a loan, review the details with the lender you are applying to. Some may only require a five-minute request, while others, like the SBA or banks, may have more complex processes that require you to provide your business plan and/or financial statements and filings. of income.
There are business resources like the Maryland Small Business Development Centers and the Maryland Women’s Business Centers who can provide you with technical assistance, such as helping you create a business plan or apply for business loans.
During your application, regardless of the type of financing you are applying for, you will be asked to provide information about your business, including how long it has been in business, its annual revenue and its address. You may also need to provide details such as your social security number.
Once you’ve been approved, you’ll be presented with loan options, including interest rate and repayment terms. If you accept them, you will sign the loan documents and then the funds will be deposited into your business bank account in just one day.
Uses of Maryland Small Business Loans
Unless your business loan specifies what you should use it for, such as equipment loans, you can use it for a variety of purposes related to your business.
Many small business owners use financing to grow their business, such as renting a second location and renovating it. They could use a loan to hire employees or buy larger amounts of inventory. They can use the funds to buy equipment or just to have working capital when they need it.
Whatever your needs, Nav has great financing options to help.
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