Austin SBA loans are a popular source for needed commercial capital. While there are different ways to finance business operations (including revolving credit, credit cards, and even 401k loans), SBA loans offer different options. And, because they are guaranteed by the federal government, these debt instruments are a bit less risky than other forms of borrowing for commercial ventures. So, read on to learn more about Austin SBA loans and what you need to know.
Austin SBA loans generally come in four packages: 7(a), 504, microloans, and disaster relief. Although they are labeled as Small Business Administration loans, the government itself is not the actual lender. Rather, the application and approval process is mostly (if not entirely) handled by banks, credit unions, and other lenders. Terms may or may not be flexible, but interest rates are usually competitive, though a tad higher, due to their guarantees. Here are a few details about Austin SBA loans:
- 7(a) loans. Applicant businesses can borrow up to $5 million and funds must be used to buy commercial equipment, expand an existing business, or for working capital.
- 504 loans. Applicant companies can also borrow up to $5 million within the 504 loan program. Funds are for things like purchasing vacant or unimproved real estate, buying machinery, or acquiring facilities.
- Microloans. Applicants can borrow up to $50,000 and the funds must be used for start-up capital, working capital, purchasing equipment, and/or inventory.
- Disaster loans. Applicants can borrow up to $2 million and must use the funds for recovery purposes.