Best Small Business Loans in Lansing, MI

How to get a business loan in Lansing

A business loan provides funding to start or expand a business. These loans are used for everything from unexpected short-term expenses to long-term equipment purchases. The type of loan you need will depend on your business and the purpose of the funds. Some of the most common types of loans in Lansing are:

• Term loans are traditional loans that provide a company with upfront cash that is paid back over a predetermined period along with interest.
• Business lines of credit work like credit cards and allow a company to withdraw funds up to a set limit. The company only accrues interest on the funds that are used.
• Equipment loans are used to finance new equipment a company needs to start or expand. The purchased equipment serves as collateral for the loan.
• Merchant cash advances provide upfront cash that is repaid by taking a percentage of the company’s credit or debit card sales instead of a set payment.
• Invoice financing is a short-term loan that provides upfront cash quickly. The loan is secured by unpaid invoices owed to the business.
• Microloans are small, short-term loans often targeted to small businesses in specific industries or geographical areas.
• SBA loans are backed by the U.S. Small Business Administration. These loans have low-interest rates but require a lengthy and rigorous application process.

Choosing a lender in Lansing

Different types of lenders are available for businesses in Lansing, and the one you choose will be based on your company’s needs. Traditional lenders, such as banks, may have a long application process and require a higher credit score, while nontraditional online lenders may base their decision on your business plan and a viability assessment.

While starting a business or getting a business loan with poor credit is not impossible in Lansing, you may have more difficulty qualifying or pay higher interest rates. The Michigan Small Business Development Center has an office in Lansing and can help craft business plans and provide information on what resources are available for your company. Many lenders will also have business consultants to help you.

Business loan payments and fees in Lansing

Most business loans in Lansing require regular payments, which are usually monthly but could also be weekly, bimonthly or another set period. Failure to make payments adds penalty fees to your balance and could end with the lender seizing property used for collateral.

Lenders may add other charges to your loan, including origination and processing fees. These are generally taken out of the loan amount you receive, so be sure the total amount of your loan is enough to cover these costs while still leaving enough for the loan’s intended purpose. When comparing loan offers, be sure to ask about all fees that may apply.