If you’re considering launching a startup or small business, it, of course, makes sense to secure some capital. Finding a business loan that’s right for your enterprise isn’t always straightforward. When it comes to the state of California, too, there are a few laws you need to keep in mind. That said, it is not all bad.
This does mean that you are going to need to do a bit of homework. We highly recommend that you compare the best business loans CA has to offer, for example. But what else is worth keeping in close mind?
Consider Your Channels
Thankfully, there are multiple channels through which you can apply for funding in California. What’s more, the recent legislation in the form of SB 1235 is helping to make small business borrowing more transparent.
That means it’s easier to find opportunities in California than it is across many states if you want to fund a business. There are plenty of channels, and things to keep in mind, however.
The California Small Business Loan Guarantee Program
The CSBLG program is set up via the federal government in California in partnership with multiple financial bodies. If you have up to 750 staff members through this program, you could secure a loan of up to $20 million.
The securing rate for this program, too, is pretty promising. You can expect around four out of five applications to be successful. To apply, you’ll need to accept interest rates and a payback period of around seven years. You’ll also need to speak to an FDC to get things moving.
Other Avenues to Consider
You can also apply for small business credit in the shape of business lines of credit and bank loans. Again, there is more transparency here than ever before, but do take care to check all terms and conditions.
There are also SBA loans and microloans. The Small Business Administration offers a long list of requirements, however, so always make sure that you fit the bill. Microloans, as the name suggests, are finance options at lower rates. You’d expect to borrow up to $50,000 through this method.
Californian business owners may also use channels such as the Opportunity Fund, a nonprofit, for financing support. Or, you could claim a small loan of up to $8,000 through Accion.
Keep an Eye on the Following
Before you apply for any Californian business loan, always check you’re likely to appeal to lenders. Do you have a strong business plan? Do you have a clear record of your expenditure and revenue? Even more importantly, is your credit score healthy enough?
If you are unsure, there are ways through which you can build and improve business credit. While there are open channels for business finance in CA, you’re still going to need to jump a few hoops.
California is one of the absolute top places in the US right now to start and fund your own business. The law’s there to protect you – why not take a look and see what you could borrow?
