The state of Illinois is no stranger to entrepreneurs. In fact, there is 1.2 million small businesses in the state, constituting 99.6% of all businesses in Illinois.
But running a business costs money, and sometimes you need a little help in that department. Illinois small business financing might be what you need to help your business thrive.
How a Loan Can Help Your Illinois Small Business
Small business financing can provide you with capital to invest in growing your business. You could hire new employees to better meet demand. You could invest that money in marketing to reach more customers.
If your business is seasonal, an injection of cash could help you get through slow periods. There are so many ways funding can help!
Illinois Small Business Loan Options
If you are considering a small business loan, be sure to explore all of your options. The better your credit, the better terms you may qualify for.
Coronavirus Pandemic Loans
Due to the severe impact the coronavirus pandemic has had on small businesses nationwide, there are a few economic relief programs designed to help get affected businesses back on their feet.
In addition to federal loan programs, the Paycheck Protection Program, and Economic Disaster Loans, Illinois businesses may also qualify for the program. Illinois Small Business Emergency Loan Fund.
Term loans
Banks and credit unions, as well as some online lenders, offer longer-term loans at competitive rates. To qualify, you will need good to excellent credit.
SBA Loans
The United States Small Business Administration offers what may be the lowest interest rate on loans available to those who qualify. There are loans for business development and others to enhance economic opportunities in disadvantaged areas.
Loans like the 7(a) or 504 loan can be used for business expenses, equipment, and real estate, among other things.
Credit line
While a loan provides a lump sum of money all at once, a line of credit gives you access to cash when you need it. You can borrow on this line, repay it and borrow again.
Equipment financing
If you use expensive equipment in your Illinois business, consider an equipment loan or lease. The equipment you buy serves as collateral, which can help you qualify for low interest rates.
Credit card
In addition to a loan, having business credit cards shopping for your business can be helpful. Get one with rewards and you can earn them for shopping and then redeem them for travel or cash back.
Short term loan
For those without good credit, some of the above options may not be available. If so, there are short-term loans you may qualify for. These however have higher interest rates.
How to Qualify for a Small Business Loan in Illinois
Eligibility for loans in Illinois may vary slightly from lender to lender. Generally, however, you can expect your professional and personal credit to be considered.
Like I said, the higher your credit scores, the better loan options you’ll qualify for. Some lenders will ask if you have established business credit. If you don’t, learn how to establish business credit you are therefore entitled to more options.
Lenders may also look at how long you’ve been in business and your annual income to determine if you qualify for financing.
How to Apply for a Small Business Loan in Illinois
Requests for small business loans can vary wildly, depending on where you are applying. Online lenders tend to have short applications that only take a few minutes to complete, while banks and SBA loans often involve applying in person and providing lots of documents.
Whichever option you choose, prepare what you can in advance. You will need to provide information about your business such as:
- Address and contact details
- How long has he been in business
- Employer identification number
- Company or LLC incorporation documents, if applicable
- Annual income
You will also need to provide personal information, such as your social security number and contact information.
If you apply online, you can get an instant decision. Banks and SBA loans usually take a few days or weeks to process.
Once you have been approved, you will need to review your loan agreement, which will contain your approved loan amount, as well as the interest rate and repayment terms to which you are entitled. Once you’ve signed the agreement, your funds will be deposited into your bank account in as little as one business day, depending on your lender.
What Qualifies as a Small Business in Illinois?
You might be wondering what exactly constitutes a small business in Illinois. There are no published parameters unless you are applying for a program like the Small Business Set-Aside Program.
In this case, small business owners are those who have one or more of the following qualifications:
- Your wholesale business’ annual sales and revenue were $10 million or less
- Your retail business’ annual sales and revenue were $6 million or less
- Your construction company’s annual sales and revenue were $10 million or less
- Your manufacturing company employs 250 people or less
What grants are available in Illinois?
Grant programs are other great resources to help you find financing for your business. The federal government, local governments, and even private corporations offer entrepreneurship grants to eligible businesses and nonprofits.
the Business Interruption Grant Program (BIG)offered by the Illinois Department of Commerce and Economic Opportunity (DCEO), is one to determine if your business has been impacted by the coronavirus, but check to see if the grant is still open.
There are other federal grants available for businesses in certain areas, such as health or education, as well as those for minority businesses.
Get the loan your Illinois business needs
From Chicago to Springfield, savvy entrepreneurs know that small businesses sometimes need financing to get ahead. Find the right loan or financing solution that fits your business needs in Illinois and see how far it will take you.
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