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Small Business Loan

Discussion in 'Business Operations' started by lawnspecialties, Jun 4, 2006.

  1. lawnspecialties

    lawnspecialties LawnSite Silver Member
    Posts: 2,513

    I've been toying with the idea of looking into "small business loans". Right now I have my truck and a tractor financed but all else is paid for. I'm also thinking of getting a second setup (truck and mower). If I had one big loan for it all, it sure would be easier to deal with. But, I don't want to increase my already pretty good interest rates.

    Anyone dealt with these? Are the rates bigger, smaller, or about the same as other loans? Anything else to consider? Thanks:)
  2. Need a Little Trim

    Need a Little Trim LawnSite Member
    Posts: 137

    I am looking into the SBA 7A loan and it is for the things that you are refering to. Interest rates are from 2.25 to 4.25% I wanted to see if anyone else had the ideas on the subject also.
    The government guarantees 85% of the loan and the bank that you go through eats the rest if you default.
  3. rodfather

    rodfather LawnSite Fanatic
    Posts: 9,501

    have ya looked at getting a revolving line of credit at your bank as another option?
  4. lawnspecialties

    lawnspecialties LawnSite Silver Member
    Posts: 2,513

    I have a $10,000 revolving line at my Credit Union. Of course that's not enough, but the big thing is the interest rate. If I'm financing for a few years, I definitely want the lowest rate possible.:)
  5. topsites

    topsites LawnSite Fanatic
    Posts: 21,653

    Yes because I can get a loan right now... At 15.9% apr, by the time I'm done paying it back, I've paid 1.5x the amount so if I borrow 10k, I pay back 15k. Raw deal.
  6. rodfather

    rodfather LawnSite Fanatic
    Posts: 9,501

    it's called business
  7. SodKing

    SodKing LawnSite Bronze Member
    Posts: 1,648

    I had an SBA loan once. THe process was excruciatiing. Every nuance of your business is scrutinized and critiqued and then there are the 4000 forms to sign
  8. Need a Little Trim

    Need a Little Trim LawnSite Member
    Posts: 137

    Were the savings on the apr worth it though?
  9. drmiller100

    drmiller100 LawnSite Senior Member
    Posts: 562

    How much time do you have to fill out the forms, and wait to get your money?

    Right now, if you start, you should have your money figured out for next year using the SBA route. But I'm kind of busy right now.

    Buy the truck with your line of credit. buy the trailer and trimmers with cash. buy the mowers new from your manufacturer, and shop based upon interest rates.

    Your truck should be the highest rate, adn pay it off first.
  10. AAELI

    AAELI LawnSite Senior Member
    Posts: 362

    I went to my local banker and was able to go with the SBA LOWDOCS loan, requires less documentation compared to other apps. I have been successful in using this route. I had to supply the usual docs regarding how long in business, use for the money, and sign a guarantee.

    The process is not difficult if you have a good handle on your paperwork.

    Take your time and do it right. Most banks have a person designated to assist you with this process. SBA guarantees the loan that the bank books.

    Hope this helps.

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