Great Business Loan Options for Veterans
There are more than 21 million veterans in the United States, and so it should come as no surprise that approximately 10% of all US-based businesses are owned by a veteran. After serving our country, plenty of veterans decide to utilize their skills and knowledge to launch a new business. A few are extremely successful immediately and are launched into the world of bug business. However, most business owners (veteran or not) will require some sort of loan, as is the case with all owners of small businesses. Here’s where we can help.
American Business Credit offers a multitude of loan options and is proud to work with US veterans to secure the best possible loan. So, if you want to save some time, call or click to apply with us today and speak with one of our specialists. If you simply need to know more, then read on. We’re about to tell you everything we know about the best methods for US veterans to apply for small business loans. Yes, ma’am or sir, there is an array of options, but here at American Business Credit, we’re glad to be part of a team able to offer multiple options for veterans, and to be part of the effort to make it simple for veterans to receive the loans they deserve.
First, we will discuss the many different benefits and opportunities associated with small business loans for veterans. Then we’ll discuss when the best time is to apply, the different types of loans available, (especially those specific to veterans), and wrap up with an FAQ section. If you’re a veteran looking for advice on small business loan, then welcome to the right place!
Benefits and Opportunities
For a veteran starting a small business, a loan helps cover the costs of getting into the swing of things. It can provide financing for real estate, hiring, payroll, repair, maintenance, overhead, or any other type of business expense. Some common ways veterans utilize the funding of a small business loan include but are not limited to:
- Inventory Purchase. Maybe you landed some pre-sales, and you need to fulfill. Maybe you need to stock up for a busy few month. No matter what, a small business loan can cover the cost of more inventory if this is one of your issues.
- Perhaps you bit off LESS than you can chew, and you need more space?
- A loan can help procure advertising or marketing strategies. In the digital age, a few online advertisements can go quite a long way.
- Equipment Upgrade. Is your copier crapping the bed? Maybe your printer still makes sounds like AOL did in 1999. A loan would help upgrade it all, leading to more efficiency and ultimately more profits.
- Hiring and Training. Any business owner, no matter how new, knows that it costs money to hire and train employees. A small business loan could cover it all until things get rolling.
These are hurdles every business owner faces, but as a veteran, some of these hurdles can seem even harder to jump over. Obviously don’t start every conversation with a potential lender on the topic of being a veteran. However, letting a prospective lender know that you served our country is never a bad idea. Next up is learning when the right time to apply for a small business loan is (especially for a veteran) but be proud of your service! And bear in mind that probably more lenders than you think will offer some sort of discount or reward for a veteran.
The Best Time to Apply
It could be that your active duty ended earlier today and you’re here trying to learn how to apply for a business loan here and now. It could be that you’ve been a veteran for decades and you’re just now entering the world of business. This begs a question: When should you apply?
Well, just like it doesn’t matter when you served our country, it doesn’t matter when you apply for a small business loan as a veteran. Most lenders will offer some sort of special treatment to US veterans, even if it’s simply insider advice for your situation. This includes us, so just as a quick reminder, click here now to get started on applying for a small business loan catered to veterans!
The best time to apply for a small business loan is AS SOON AS YOU READ THIS, since you’re obviously already here for such matters. Read on to learn about all the different types of small business loans applicable to veterans like yourself.
Types of Small Business Loans
First off, before we get into veteran-specific loans, let’s discuss what different types of business loans there are. It’s important to know which type is the best fit for your business first before applying. Bear in mind these are just four of many possible loan types, but these four are among the most popular types of small business loans. Call us today or browse our Articles & Resources page for information on other types.
Business Line of Credit
Think of this as having a credit card, just with your credit all at once, and without the plastic. With approval, you’ll be given credit up to a certain amount, and you will only be responsible for paying back (with interest) the amount you borrow. For example, say you qualify for a $75,000 business line of credit loan with an interest rate of 5%. If you choose to only borrow $50,000, you’ll only be responsible for paying back the $50,000 plus the 5% interest of $2,500.
This can be extremely handy because some other loans are fixed amounts. Business line of credit loans offer flexibility. It’s a sort of all-purpose loan; the funds can be used for any aspect of your business, from inventory to paying debt, from payroll to covering the costs of that unexpected worksite accident that insurance won’t fully cover. Plus, once you repay the line of credit, it opens back up fully. You could potentially have the loan open for years, even for the full run of your business.
Business Credit Cards
Easily the most popular form of funding for a startup, business credit cards come with low interest rates and quick availability of funds. If you don’t already have a line of credit open under your business’ name, a business credit card is an especially lucrative option. We recommend not using a personal credit card for your business. It’s just too easy for the financial records to cross paths and become misconstrued. Also, as a pro tip, before you even apply for a business credit card, make sure to have a plan implemented as to what qualifies for a business purchase and which employee(s) can use the card.
They work the exact same way as a traditional credit card, except the cardholder is the business, and the terms rely much heavier on the business credit score as opposed to your personal score. Another pro tip? Spend an entire workday researching deals and their fine print. Some credit cards offer 0% APR and others offer cashback rewards.
Independent Lenders
We can assume you’ve already contacted your personal bank, or other banks, to see what they may have to offer. Sometimes you’ll get a great deal. However, more and more, small business owners are turning to independent lenders due to competitive rates, and perhaps more importantly, better customer service. Independent lenders are sort of like the mom-and-pop version of big banks. Sometimes you’ll find that not only are the prices more than fair, but the quality of the product and the service you receive are unbeatable.
Take us into consideration. American Business Credit, aka ABC Biz Loans, is one of those mom-and-pop-feel independent lenders, except we’re highly accredited and we offer competitive rates with unbeatable customer service. Again, as with finding the right credit card, it is your responsibility to have due diligence when choosing a lender. However, don’t just take our word that we’re among the best. Call us now and let us prove it.
Equipment Financing
Put rather simply, equipment financing means receiving a loan for the exact cost of all needed business equipment. If your business requires more than the average amount of equipment in order to function, absolutely consider equipment financing. The equipment itself acts as collateral and secures the loan for the lender, and the borrower is able to utilize the equipment immediately for business. Equipment finance is truly a win-win situation when properly handled, and therefore many companies take advantage of it.
Bear in mind there are two distinct types of equipment finance: leasing and financing for ownership. Just as with automobile leasing, equipment leasing involves paying a monthly fee in order to utilize the equipment for a set number of months. Upon the end of the term, the lessee may decide to return the equipment or take ownership upon a balloon payment. Financing for ownership entails you owning the equipment upon the end of the term.
Business Loan Options for Veterans
We pride ourselves on our commitment to each and every applicant, and we’re especially proud when we work with veterans. If any of the above loan types appeal to you, or you’ve done some research and found another type, please call us today. We will walk you through every single option you have as someone who has served our country.
That being said, there are a couple of programs that you should know about. One is the SBA Veterans Advantage. Currently, the Small Business Administration offers zero upfront fees for all veteran loans $350,000 and under. (The normal fee is around 3% of the loan.) According to the SBA, more than 70% of their loans to veterans are within this range and qualify for the program. Furthermore, the SBA offers counseling, training and other business development opportunities for veterans.
The Department of Veteran Affairs, commonly known as the VA, also offers a multitude of loan options. The Office of Small and Disadvantaged Business Utilization (say that five times fast) has a comprehensive guide for veterans seeking business loans on their website.
Qualifying for a Veteran Loan
Most loan providers offer some form of veteran or military discount, and surely each has its own set of qualifications. However, the majority of the time, in order to qualify for a veteran-specialized loan, the business must be at least 51% owned by someone who falls under one of the following:
- Honorably discharged veteran
- Active duty service member eligible by the military for a loan
- Service-disabled veteran
- National Guard and/or Reservist
- Current spouse of anyone who meets any of the above
- Widowed spouse of a service member who died while in service or due to a service-related disability
The Last Word
Applying for a business loan as a veteran should be exciting! Hopefully now you’re aware of some benefits you weren’t aware of before. Also, there are surely more benefits applicable to your situation uniquely and we want to help you discover them. Give us a call today or click to get started. We want to thank you for your service by providing you with ours.
