With the economic revitalization in Buffalo and surrounding communities, it’s a good time to start a business or expand your company’s operations. Business loans provide funding to make founding or growing a company possible. Our partners at ConsumerAffairs researched the best business loans in Buffalo to help you succeed.
Even the best small business in Buffalo needs help to grow and expand. Business loans are designed to provide funding for your company and can be used for:
Increasing marketing and advertising
Finding the right small business lender can be crucial to your company’s extended success. A good lending company will provide financial advising, set you up with the right loan for your needs and find terms that will let you expand without creating a burden on your budget.
Types of business loans in Buffalo
Most business loans are designed for specific purposes, and your intended use of funds and desired term of repayment affects which is best for you. Some of the most popular loans in Buffalo are:
Term loans are traditional loans that provide a company with upfront cash that is paid back with interest over a predetermined period. These can be short-term loans, which are paid back from within a few months to two years, or long-term loans, which may have terms up to 20 years or more.
Business lines of credit allow the recipient to obtain cash for purchases as needed. These loans often require collateral and allow withdrawals up to the appraised amount of the collateral property.
Equipment financing loans are designed for purchasing equipment and take depreciation and other factors into determining loan terms, including the rate and length of the loan. The purchased equipment serves as collateral for the loan.
Construction loans are used to develop new facilities or expand existing structures. These are often long-term loans because of the high cost of construction.
Accounts receivable loans provide businesses with a short-term loan that provides a quick infusion of cash. The company uses unpaid invoices as collateral for the loan.
Start-up loans are for businesses that have not yet begun to operate but have set forth a plan and need funding to launch. Lenders offering start-up loans often look for new ideas that hold promise or for an established business concept that meets a specific need.
SBA loans are authorized by the U.S. Small Business Administration for companies that meet specific standards and are administered through third-party lenders.
Some loans are offered solely to members of certain demographics. Loans may be available to revitalize a designated neighborhood or for women-owned businesses or members of a specific group. These loans may be limited in number, so check with any affiliations you have to see what is available.
Qualifying for a business loan in Buffalo
Even if you have an established company, a well-written business plan is a must for anyone looking to obtain a business loan. Many lenders will have financial consultants that can help you with this, or you can hire a professional writer to create one.
Check your credit score so that you’ll know where you stand before you get started. Having a higher credit score lets you receive a lower interest rate and better loan terms. Borrowers with poor credit have options through alternative lending sources, which often require weekly or monthly repayments over a short term.
Research lender qualifications, fees and terms so you don’t end up wasting time and money on unrealistic expectations. Speak to a loan officer at your local bank or credit union and consider online lending sources before submitting applications. Every application you submit may affect your credit score, so narrow your choices to a few suitable bank lending options.
Loan fees and other considerations in Buffalo
When comparing loan offers, look for any fees that may add to the cost of your loan. These fees are often taken from your loan amount, so your loan needs to be large enough to cover its intended purpose plus additional charges. Some common loan fees in Buffalo include:
Origination fees cover the cost of processing the loan
Prepayment penalties may apply if you pay off the balance of your loan before the completion of the agreed term
Referral fees are charged by loan brokers for referring you to a lender
Packaging fees cover the cost of preparing a loan application to present to a lender
Know the repercussions involved if you default on the loan and if it’s possible to change the loan terms at a later date. Understand how the cash will be made available to you and how often. Some lenders will provide several options, including direct deposit into your bank account or a series of checks.
Seek Business Capital
Seek Business Capital is an online lending resource that helps small business owners and start-ups find loans through a network of lenders. The company has business consulting services and can provide business funding estimates in a matter of hours. Buffalo customers said they were pleased with the ease and speed of the company’s loan process.
Imperial Advance is an online lender that utilizes a network of lenders to provide needed capital to small businesses. The company helps applicants with low credit scores find loans, and it offers same-day funding through in-house sources. Buffalo reviewers enjoy working directly with a consultant to find options that fit their company.
National Business Capital
National Business Capital allows you to file one application and let multiple lenders bid for your loan. The company is an SBA partner and has live chat for additional assistance. Buffalo reviewers praise the process and appreciate working directly with a representative to tailor funding to their needs.
Evans Bank is based in Hamburg and operates in the Buffalo and Western New York region. The company provides a variety of loans, including equipment financing loans and commercial real estate loans. Buffalo small business owners praise the personalized service they received at the bank’s local branches.
M&T Bank operates mostly in the Northeast U.S. and has local branches in Buffalo and the surrounding area. The lender offers multiple loan options, including SBA loans. Buffalo reviewers appreciate the large variety of loans and services but express disappointment with customer service and the difficulty of reaching a live representative by telephone.