Small Business Loans

A loan is a type of debt. In a loan, the borrower initially receives or borrows an amount of money, called the principal, from the lender, and is obligated to pay back or repay an equal amount of money to the lender at a later time. Typically, the money is paid back in regular installments, or partial repayments. The loan is generally provided at a cost, referred to as interest on the debt, which provides an incentive for the lender to engage in the loan.

Government agencies generally do not make loans directly to business owners. The government provides a guaranty to banks and lenders for money lent to small businesses. This guaranty is a promise to pay a portion of the loan back to the bank in case a business owner defaults on the loan. A guaranty reduces the lender’s risk, which allows the lender to make loans to business owners who do not qualify for traditional loans.

So, the first place to start looking for a loan is with your local commercial bank or lending institution. The lender will have all the forms you’ll need to apply for a government-backed loan, and will work with the government on the application process.

You should also look to your state and local government agencies and local non-profits. Some of these organizations make loans directly to businesses, which means you won’t need to go through a bank.

Applying for a Loan

There are hundreds of government loans available for small businesses. Each loan program has unique application and eligibility requirements, however, most lenders ask for the same information for you. Before you apply for a loan, you should get some basic documentation together that will go into just about any loan package.

• Business Loan Application Checklist

  List of required forms and documents typically needed when applying for business loans.

• SBA Loan Application Checklist

  Includes a list forms you need to complete and submit to your lender when applying for a SBA guaranteed loan.

How to Find Loans

To learn about loan programs for which you might qualify, visit our Loans and Grants Search Tool or these resources:

• SBA Loans
• Disaster Assistance Loans
• Energy Efficiency Loans
• Farm and Agricultural Loans
• Export Assistance Loans
• Rural Business Loans
• Loans for Veterans

Loan programs for women and minority owned businesses are generally provided by non-profits and state agencies. Use the Loans and Grants Search Tool to find information on loan programs for businesses in your area.