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Certainly one of the perks of American business is the aid with which you, as a business owner, have access to from the federal government. Since 1953, the department of commerce has been on a spree of expansion in an attempt to help various groups of people not only find work, but also own their rightful piece of the American pie. This article will provide a couple of insights as to how to get a free government small business loan.
The most well-understood method for this is the Small Business Administration. The SBA was started under the Eisenhower administration and was initially designed to guarantee loans to veterans and the disadvantaged. Over time it grew to extend loan programs to women, minorities, and various other groups that are in need of loan assistance. Though it started coming under attack in the late nineties and was again nearly dismantled in 2004, the SBA has once again become a strong source of lending with aid from federal assistance from the TARP money.
If you are interested in how to get a free government small business loan from the SBA, know that you will have to meet the following criteria in order to qualify:
You will have to have to be invested in the loan. Though the SBA is more liberal in its grants than most conventional lending institutions, they will probably want to see at least 20% of your personal capital invested in it.
You will need a strong business plan. Be prepared to give a solid, straightforward explanation of your business plan and make a compelling case for your loan.
A good personal credit rating. In the absence of a mighty Paydex score, you will need to show that you are good for the money and that you have the credit to back it up. Having collateral, such as real estate, will greatly help your chances.
Show background and experience. The more you can demonstrate to the SBA that you have the management background needed to run your business, the more likely they will be to help you finance it.
Some SBA loans will be easier to come by than others. Because the SBA offers a Microloan program (guaranteeing loans for under $35,000), you should have little difficulty getting at least some of the money that you need. Know also that you can apply for more than one at a time. Applying for multiple Microloans is one of the best methods for how to get a free government small business loan.