What Are the Best Small Business Loans in Michigan?
Whether you need to cover your startup costs or company’s day-to-day expenses, getting a small business loan might go a long way. Depending on your business’s needs, a small loan can help you purchase equipment, pay utilities, or acquire real estate.
We will explain how small business loans in Michigan work and show you what some of your best options are. You can also learn how to generate a perfect loan request letter, which will ensure you get approved by any bank or online lender!
A small business loan is a type of financing provided to business owners and companies for different purposes. If you get a small business loan, you will receive funding to cover your business’s expenses, while:
- Ensuring that your business keeps growing—By having capital, you will be able to expand your company, hire additional staff, and more
- Diminishing seasonal cash flow gaps—If you get a small business loan, you will handle your off-season easier and ensure you have a constant cash flow
- Having more opportunities—Having a bigger budget will enable you to catch an unexpected discount or land a similar deal
In Michigan, you can apply for several business loan programs, including:
- Michigan Small Business Grants
- Michigan Small Business Association (MSBA)
- Small Business Administration (SBA) 7(a) Loan
- SBA Express Loan
- Express Loan
- Small Business Line of Credit
- Small Business Term Loans
This program was established to help businesses recover from the impact of the COVID-19 pandemic. The MSBA gives grants to companies affected by the pandemic, but if you cannot secure a grant, there is a chance that you can get a loan.
The MSBA offers loan programs to cater to various small business owners’ needs. The organization’s goal is to bring owners together, share knowledge, and create collaboration and partnerships. To qualify for the MSBA loan, you will need a solid credit score and an already running business.
The 7(a) loans are backed by the SBA and can have multiple purposes. You can use the borrowed money on:
- Improving working capital
- Refinancing business debt
- Constructing new buildings
The amount of money you can borrow cannot exceed $5 million, and you need to repay it in monthly payments with interest. The rates are around 2% and depend on the amount you borrow.
The SBA Express loan is a type of loan backed by the government, and you can take it out to cover various business expenses, such as inventory, equipment, utilities, etc. The loan has a variable rate that can be fixed, and the SBA sets the maximum rates.
Michigan Business Express Loan can get you up to $150,000 for the purchase of vehicles or equipment. You need to pay 20% of the loan upfront (the $450 fee will be included in the loan).
If you want to borrow money through this program, you must have the Automated Clearing House (ACH) and eStaments (monthly statements that can be viewed online) set up.
This is a flexible loan that gives you access to a fixed amount of capital, from which you can draw money as needed. It is perfect for financing short-term assets or paying for receivables.
Term loans are one-time capital loans that have a fixed monthly rate and can be used for various purchases (e.g., vehicles, equipment, etc.). The interest is either variable or fixed, and the average term is five years.
To get a small business loan in Michigan, you must:
- Have a business plan prepared
- Prove that you can afford the payment
- Choose collateral if needed
- Prepare some of the following documentation:
- A color copy of your driver’s license and ID
- Business application acknowledgment and agreement
- Personal financial statement
- Business tax returns
- Business debt schedule
- Proposed project cost (if applicable)
- Small business loan request letter
Once you have everything ready, you can visit the U.S. Small Business Administration headquarters in Michigan. If you want to go through the process as smoothly as possible and ensure that your application gets approved, use DoNotPay! We will help you gather the required paperwork and draw up an error-free loan request letter for you!
Going through the application process for a startup or small business loan is difficult, especially if you do not have experience in writing loan request letters. That is why you should rely on DoNotPay for help! Our AI-powered app will make sure you gather all the necessary documents and generate a tailor-made loan request for you.
All you have to do is:
- Sign up for DoNotPay
- Gather your credit scores
- Answer our chatbot’s questions about you and your business
- Upload the necessary documents
If you need help finding a lender, use DoNotPay’s Find Online Business Loan Lender tool. With this feature, you can find the best loan provider in Michigan, as well as in:
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