Loans For Small Businesses

Donna asks…

What are good resources for applying for small business loans and grants?

I would like to open a small business and I need to know what resources are available to me to help support the financial part, not sure where to begin my search and how to go about finding the requirement to apply for grants/loans, any help will be greatly appreciated. I have a business plan completed ready to be submitted just not sure where.

admin answers:

You stand a greater chance of getting a government-guaranteed loan through the Small Business Administration than a government grant. Read the SBA Financing page to learn about criteria needed for borrowing

It is hard to find grants to start a business. Unlike the myths that some perpetuate, federal government and even private foundations hardly give grant money for starting a for-profit business.

One possible exception is for companies developing or exporting agricultural goods, including food and forest product. Another exception could be the Small Business Innovation Research (SBIR) or Small Business Technology Transfer (STTR) programs , which fund the research and development of technological innovation that meets specific government needs.

Your best bet actually will be from the states if they offer grant programs for women (or any other special interest groups — minorities, women, disabled, veterans, etc). Or check with non profit organizations, particularly women organizations if they offer grants. Examples include

Iowa Women’s Foundation
New Mexico Women’s Foundation

Even SBA does NOT give out grants. From the SBA website

“The U.S. Small Business Administration does not offer grants to start or expand small businesses, although it does offer a wide variety of loan programs. (See for more information) While SBA does offer some grant programs, these are generally designed to expand and enhance organizations that provide small business management, technical, or financial assistance. These grants generally support non-profit organizations, intermediary lending institutions, and state and local governments.”

Nonetheless, you can go to the Catalog of Federal Domestic Assistance (CFDA) and – these are two sites created by the federal government to provide transparency and information on grants. Browse through the listings and see if you can find any grant that would support a for-profit venture.

Here is a listing of federal grants for small businesses. See if there is any available for individuals for starting a business — THERE’S NONE.


Most of the federal grants are given to specific target groups with specific requirements (e.g. Minority business owners involved in transportation related contracts emanating from DOT – Grant#20.905 Disadvantaged Business Enterprises Short Term Lending Program

Grants are also often given to non profit groups or organizations involved in training or other similar activities (grant 59.043 Women’s Business Ownership Assistance that are given to those who will create women’s business center that will train women entrepreneurs

Charles asks…

Are small business loans hard to get in this economy?

I am looking into getting some start up for a small business. I would think that small business loans would be on the incline right now because new jobs would stimulate the economy right? Does anybody have any insight on this?

admin answers:

Small business loans for a start up business are almost impossible to get in any economy unless you have collateral to support the loan.

New companies are funded by the owner, friends, relatives, credit cards, home equity, etc.

Thomas asks…

What is the usual interest rate for small business loans?

I have seen one with 12.62%. Is this ‘normal’, ‘lower than usual’ or ‘higher than usual’?

What is the interest rate for small business loans in general?

admin answers:

Yes, that is normal, these loans are HIGH risk

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