How to Get a Small Business Loan in Colorado
If you own a small business in the Centennial State, business financing is worth exploring. In this blog post, we’ll take a closer look at small business loans in Colorado.
How to Spend Colorado Business Loans
Colorado small business loans can come in handy in numerous situations. You can use them to cover startup costs, such as equipment, incorporation fees, office space, inventory, and marketing. If you’re an established business owner, you might take out a loan to expand your products offerings or open new locations.
Types of Small Business Loans in Colorado
There’s no shortage of small business loans in Colorado. That’s why it’s a good idea to understand the various options at your disposal. By doing so, you can choose the right financing option for your unique venture.
Note that some business loans are easier to obtain than others. However, they might come with higher rates and fees, costing you more in the long-run.
Term loans are installment loans offered by banks, credit unions, and online lenders. Usually, qualifying for this type of loan will require good credit score and stable revenue. The greatest benefit of term loans is their competitive interest rates and favorable terms.
Partially guaranteed by the U.S. Small Business Administration (SBA), SBA loans are available through SBA-approved financial institutions. The SBA 7 (a) loan is the most popular option and offers up to $5 million in funding with repayment terms of up to 24 years.
Line of Credit
If you receive a line of credit, you’ll be able to withdraw as much or as little as you’d like up to a set credit limit. During the repayment period, you’ll only pay interest on the amount you borrowed. Compared to business credit cards, lines of credit offer lower interest rates.
If you need to buy or lease any type of equipment, an equipment loan is ideal. Since it will be secured to your equipment, it’s easier to qualify for. The downside with an equipment loan, however, is that you can only use the loan funds toward equipment. Equipment may be an oven for your restaurant, a bulldozer for your construction company, or anything you need to operate successfully.
Microloans should be on your radar if you need a small, short-term loan of up to $50,000. Most microloan lenders are mission-based nonprofits and offer resources to their borrowers. You can also apply for the SBA microloan program, which is for small businesses and qualified not-for-profit childcare centers with plans to start up or expand.
Resources for Colorado Business Owners
If you own a small business in Colorado, you might want to look into these resources.
- Colorado Small Business Development Network (Colorado SBDC): Colorado SBDC offers free consulting and affordable training programs to small business owners. There are many SBDC centers throughout the state.
- Business Incubator Center: The Business Incubator Center is in Grand Junction, CO. It provides coaching services, events and classes, and more. There’s an intensive program, which offers five years of business support to startups and early-stage companies.
- Energize Colorado: This organization strives to promote small business ownership in Colorado. It has given more than $26 million in small business grants.
- MyBizColorado: MyBizColorado makes it fast and easy to register your venture. It’s the official filing tool for small businesses in Colorado.
Conclusion: Set Your Business Up for Success with Colorado Business Loans
Colorado has a strong economy and low unemployment and tax rate, making it a great place to start or grow your business. With a Colorado small business loan, you can enjoy a thriving venture in the Centennial State.
Editorial Note: Any opinions, analyses, reviews or recommendations expressed in this article are those of the author's alone, and have not been reviewed, approved, or otherwise endorsed by any of these entities.