FINANCING SOLUTIONS
Business Loan Options
Learn more about the business loan options offered through BankLink’s network of nationwide lenders.
Most Popular Solutions
Note all of the below programs are eligible for a wide variety of uses of proceeds and the table is only meant to display the most common uses and benefits.
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Up to $25 Million for Rural Businesses
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Great for Commercial Real Estate
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Up to 30 Year Repayment Terms
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Up to $5 Million for Qualified Businesses
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Great for Business Acquisitions
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Increased Flexibility Compared to Conventional Loans
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Up to $500,000 for Qualified Businesses
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Great for Working Capital
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Expedited Funding Timelines
USDA B&I Loan
The United States Department of Agriculture (USDA) partners with both public and private community-based organizations, as well as financial institutions, to provide funding through select programs to support economic growth in rural areas (definition of “rural” varies by program).
The B&I (Business & Industry) loan guarantee program gives rural businesses access to affordable financing of up to $25 million to improve the communities’ economic health.
Pros of USDA B&I Loans:
- Extended Repayment Terms: USDA loans offer a maximum of 25-40 years for real estate purchases, conserving cash flow long-term for large financing needs.
- Flexible Use of Proceeds: USDA loans give business owners a unique level of flexibility in how they choose to use the funds, from real estate purchases to equipment financing, hiring, working capital, and debt refinancing.
- Competitive Interest Rates: here is more flexibility surrounding interest rates. Lenders must set reasonable rates as determined by the USDA, and rates can be fixed, floating or even a combination of both (whichever makes the most sense for the borrower).
Cons of USDA B&I Loans:
- High Closing Costs: The USDA could require an environmental study depending on your project, which typically can be cost-prohibitive for loans under a certain size. In addition, borrowers must pay an upfront guarantee fee of 3.0%.
- Extensive Application Process: USDA loan programs requires an extensive application and documentation process.
- Limited to Rural Businesses: Most USDA loans are reserved for businesses in a USDA-defined rural area with 50,000 inhabitants or less.
- Timelines – Average funding timelines are 6-12 months depending on a variety of factors.
- Loan Amount – The average USDA B&I loan size over the last years was $4.3 million. The program caps out at $25 million.
- Use of Proceeds – Business acquisitions, expansions and startups; commercial real estate and rent replacements; inventory and equipment financing; working capital; and debt refinancing (in most cases).
- Capital Requirements – The USDA requires businesses to meet certain equity thresholds from 10-25%, dependent upon number of years in business, of the total loan project costs to qualify for USDA financing.
- Terms – Up to 40 years for real estate; up to 15 years for machinery and equipment, or for its useful life, whichever is less; and 7 years for all other uses.
Eligibility includes rural areas not in cities or towns with populations of more than 50,000, and adjacent urbanized areas. A borrower’s headquarters can be based in a larger city, as long as the project itself is in an eligible rural area.
Borrowers may include:
- For- or nonprofit businesses.
- Cooperatives.
- Federally-recognized Tribes.
- Public bodies.
- Individuals engaged — or proposing to engage — in an eligible rural business.
SBA 7(a) Loan
SBA loans help entrepreneurs across America achieve their business goals by expanding their access to affordable capital. The programs are guaranteed by the U.S. Small Business Administration, enabling business owners nationwide to access financing outside of conventional bank loan products. The 7(a) loan program helps more than 60,000 businesses obtain funding each year to start, build, or grow their operations.
Pros of SBA 7(a) Loans:
- Extended Repayment Terms: Dispersing your monthly payments over a longer repayment term can facilitate healthier cash flow and more power for continual growth. Your loan term will be dependent on how you choose to use the funds, and in some cases collateral, with a 10 year term for working capital and a maximum of 25 years for real estate purchases.
- Flexible Use of Proceeds: This loan offers business owners a unique level of flexibility in how they choose to use the funds, from real estate purchases to equipment financing, hiring, working capital, and debt refinancing.
- Entrepreneur-Friendly Eligibility: Government-guaranteed loans like the SBA 7(a) loan were created to support entrepreneurs with more options outside of just conventional financing programs. If conventional business loans aren’t a good fit for your business, you could qualify for competitive financing under an SBA loan.
Cons of SBA 7(a) Loans:
- Personal Guarantee: The SBA requires that all business owners with more than 20% ownership to personally guarantee their own loan, which typically includes personal property and residences.
- Application Process: The SBA loan application process is typically a document-heavy process that can be overwhelming without the right preparation. Plan to dedicate time to your application, loan underwriting, and closing process to keep your application moving efficiently.
- Personal Credit Scores: While the SBA does not set a specific threshold, the Agency states lenders must have reasonable standards. In most cases, experienced lending institutions will require anywhere from a 650 to 680 personal credit score minimum for all partners with 20%+ ownership in the borrowing entity.
- Timelines – Funds in 60-90 days depending on how you plan to use the proceeds.
- Loan Amount – Loans range from $350,000 – $5 million.
- Use of Proceeds – Business acquisitions, expansions and startups; commercial real estate and rent replacements; inventory and equipment financing; working capital; and debt refinancing.
- Capital Requirements – Typically, 10% of the total project costs with up to 100% financing available in some cases.
- Terms – 25 years for commercial real estate, 15 years for equipment and 10 years for all other uses.
SBA loan eligibility is determined by your business size, model, business operations, intended project or use of the loan, and your ability to find funding elsewhere. To be eligible for the SBA 7(a) loan, you must:
- Be considered a small business by the SBA.
- Operate for profit.
- Use the funds for an eligible use.
- Do business in the United States or its territories.
- Prove alternative financial resources are not available before pursuing an SBA loan.
SBA Small Loan
SBA Small Loans are a subcategory of the popular SBA 7(a) program. This category includes 7(a) loans of $500,000 or less. Entrepreneurs that finance their business with Small Loans will have access to the unique benefits of the 7(a) program with an even more streamlined funding process and timeline.
Pros of SBA Small Loans (In Addition to Standard 7(a)):
- Expedited Timelines: The “small loan” typically requires less documentation, fewer steps in the approval process, and a streamlined path through the SBA due to the scoring system the program maintains (SBSS Score).
- Ideal for Working Capital: Many businesses utilize the “small loan” program for working capital needs to grow or scale an existing business. It enables a business owner to leverage SBA program benefits without taking on more debt than they’d need.
- Fewer Requirements: In comparison to the standard SBA 7(a) loan, borrowers do not have to pay a packaging fee, the guarantee fees are lower, no personal real estate can be used as collateral and there no assignments of life insurance required.
Cons of SBA Small Loans:
- Capped Loan Amount: The most any one business can borrow under the “small loan” program is $500,000. However, businesses are eligible to borrow additional funds through the standard 7(a) Program.
- Extensive Application: The program, compared to similar working capital options, still requires a higher level of document collection and longer application timelines than some online lenders.
- Timelines – Fund as quickly as 20 days from initial application.
- Loan Amount – Loans range from $100,000 to $500,000.
- Use of Proceeds – Typically, loans of $500,000 or less include working capital, equipment or debt refinancing needs. Business acquisitions and commercial real estate uses are also eligible.
- Capital Requirements – 100% financing available for existing businesses (2 years or more) seeking working capital and debt refinance uses only.
- Terms – Up to 10 years for most uses of proceeds, fully amortizing with no prepayment penalties.
Businesses must meet the 7(a) loan program’s eligibility standards in order to qualify for a “small loan”.
To be eligible for the SBA 7(a) loan, you must:
- Be considered a small business by the SBA.
- Operate for profit.
- Use the funds for an eligible use.
- Do business in the United States or its territories.
- Prove alternative financial resources are not available.
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