How to Get a Small Business Loan in Utah
The real story, though, is Utah’s massive, sustained GDP growth over the past two decades. According to Forbes, annual real GDP in Utah grew from $92.62 billion in 2000 to almost $169 billion in 2020.
Put simply, there’s opportunity for small businesses in Utah. Capitalizing on that opportunity, though, has a cost. That’s where small business loans in Utah come in.
In this post, we’ll start by reviewing why you should consider a business loan in Utah. Then, we’ll explain how different loan types in Utah that are worth considering. To wrap up, we’ll leave you with resources that are specific to Utah-based entrepreneurs.
Why Pursue Business Loans in Utah?
As mentioned in the introduction, Utah’s economy is and has been especially strong in recent years. USNews Best States ranks it number three among the 50 states, so it’s clearly a great place to establish or grow your business.
By pursuing a business loan in Utah, you can expand your operations, open a new location, renovate an existing location, or start a new business. Utah business loans can provide the capital you need to establish yourself in the growing but competitive Utah market.
Top Types of Business Loans in Utah
Utah’s inventory of available types of loans is similar to most other states. Here’s a list of small business loans in Utah to consider:
Small Business Administration (SBA) loans are similar to traditional loans except that they’re guaranteed by the SBA. This guarantee makes SBA loans among the most competitively priced loan options entrepreneurs have.
To obtain an SBA loan in Utah, you’ll need to work with one of the lenders on the SBA’s Utah Lender List.
Commercial Loans or Lines of Credit
You can work with either a traditional lender or alternative lender in Utah to obtain a commercial loan program or business line of credit. In either case, you’ll be expected to submit a loan application with financial documentation and other information.
Merchant Cash Advances (MCA)
It’s important to note that cash advances aren’t the same as term loans. They’re a type of advance that you remit based on a percentage of your debit and/or credit card sales. This financing option is only viable for businesses that make a large portion of their sales via debit or credit card.
Just like a traditional term loan, except smaller, microloans are installment loans with amounts capping out around $50,000. You can work with an SBA lender, alternative lender, or a traditional lender to obtain a microloan.
Business Credit Cards
If you need to finance large, short-term purchases, a business credit card can help you do it. The downside is you’ll need to be careful and pay your bill on time and in full. Otherwise, you may damage your credit history and you’ll definitely incur large interest charges.
Commercial Real Estate Loans
Just as home buyers use their homes as collateral, entrepreneurs can use their commercial properties. Doing so helps give you access to the larger loan amounts (at competitive rates) that you’ll need to purchase or renovate the space you need for your business.
Resources for Utah-based Entrepreneurs
State of Utah Business Resources
Utah’s state website provides a variety of resources on starting, running, and closing a business. This includes information about applying for trademarks, patents, and copyrights, acquiring a business, and franchising. You can also learn about different business structures you can use to set up your Utah business.
Utah District SBA Office
The SBA’s Utah District Office page contains many links to helpful information including (but not limited to):
- Utah Newsletter with business news in your area
- Local lender list
- Resources for starting your business
- COVID relief program information
Salt Lake City Economic Development
Salt Lake City’s Business Resources page can help you get up to speed on licensing, fee schedules, and much more.
If you’re not doing business in Salt Lake City, do an online search for “[your city] economic development”. Most cities will have city-specific resources for small business owners.
Conclusion: Take Advantage of Utah Small Business Financing
Even in a state as business-friendly as Utah, starting and growing a thriving business is no easy task. However, if you have a strong, well-targeted offering and the financial resources to scale, you can thrive in Utah.
The most important thing to keep in mind is that your business strategy comes first. If your strategy is sound, meaning you’re effectively adapting your business’s competitive advantages to the Utah market, the financing will follow.
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.