December 10, 2021
Small Business Loans in Montana: How to Select a Loan
If you own a small business in Montana or have plans to start one, you might be wondering how to cover some of your expenses. That’s where small business loans in Montana come in. In this blog post, we'll review common ways to use a business loan and how you can secure one.
How to Use Montana Business LoansYour small business is unique. This means you may have different expenses than another business in a different industry. Fortunately, you can use a Montana business loan to fund virtually any expense, including:
- Real Estate
- Expansion Projects
Types of Small Business Loans in MontanaSmall business loans in Montana are not created equal. In fact, there is a wide variety of loans you can choose from. Before applying for funding, be sure to consider the pros and cons of each option:
Term LoansTerm loans provide you with a lump sum of money upfront. Once you receive it, you’ll repay what you borrowed plus interest and fees over an agreed upon term. Terms can range from a few months to several years or even longer. Term loans are usually offered by financial institutions such as banks, credit unions, and alternative lenders.
SBA LoansSBA loans are partially guaranteed by the Small Business Administration or SBA. The SBA works with a variety of lenders to grant different types of loans. SBA loans can range from $500 to millions and come with repayment terms between 5 to 25 years. If you can land one, you may enjoy a low interest rate and flexibility that you may not be able to find elsewhere.
Business Credit CardsA business credit card is very similar to a personal credit card; you'll receive a credit limit and be able to borrow money up to it whenever you’d like. It can be a convenient way to pay bills, buy inventory and supplies, or cover travel expenses. Depending on the credit card you choose, you could access perks like cash back and gift cards.
Equipment LoansThere’s a good chance you’ll need equipment to start or run your small business. Whether you have to buy heavy-duty equipment or basic office equipment for your office, an equipment loan may be a good option. Since the equipment itself will serve as collateral for your loan, you don’t need good credit to qualify.
Line of CreditA line of credit is more flexible than a traditional term loan. It also offers lower interest rates than credit cards. If you apply for a credit line, you can borrow as much or as little as you’d like up to a set credit limit. As long as you make the minimum payments and stay under your limit, you can keep using it.
Merchant Cash AdvanceWith a merchant cash advance (MCA), you can leverage your credit card account to access funds. It can be a good choice if you need fast funding and can’t meet the strict credit requirements of other loans. With this option, you get a cash advance for business expenses in exchange for a portion of your future sales.
Resources for Montana Business OwnersThese resources for Montana business owners can make it easier for you to start or grow your business in the Treasure State.
- Montana Small Business Administration: This organization offers counseling, expertise, and resources to small business owners and entrepreneurs in Montana. You can contact its office in Helena.
- Montana Innovation Hub: Montana Innovation Hub connects entrepreneurs to a variety of sessions that support those who are trying to succeed in the midst of the pandemic. These sessions cover topics like “Lending Through a Crisis” and “Building a Successful Remote Team.”
- Montana Department of Commerce: With the Montana Department of Commerce, you can receive the support you need to apply for and receive state licenses and permits. There is also a handy tool that will help you find the perfect location for your Montana business.