North Carolina Small Business Loans

Small businesses are often referred to as the lifeblood of the local economy. As a vital part of the community, small business owners help provide jobs, keep money flowing throughout the area, and contribute to economic growth and development.

In fact, in the state of North Carolina, more than 45% of the workforce (1.7 million North Carolinians) consists of employees working under a small business operation.

In addition, total reported new lending to North Carolina businesses via loans of $1 million or less exceeded $7.5 billion in 2019, and the rate of lending via small business loans has held fairly steady in the state since 2010.

We’ve compiled a quick guide for small business owners in the state of North Carolina to learn more about loans and other forms of financial assistance available to help your business grow and succeed.

How a loan can help your small business in North Carolina

There are many ways that your small business in North Carolina can benefit by taking out a loan. Small business loans help business owners gain access to the funds they need in order to start a business, cover operating expenses, pay for emergencies, and finance expansion costs.

Loans give business owners access to opportunities without needing to have cash up front.

Small business loan proceeds can be used to cover a variety of expenses ranging from day-to-day operations and staffing needs to real estate purchases and equipment costs.

Types of small business financing options in North Carolina

Business owners in North Carolina have several financing options to take advantage of:

• Term Loans: Business term loans are one of the most popular types of business financing. They are a form of installment loan that allows qualified applicants to benefit from a fixed repayment period and monthly payment. Term loans can be secured without collateral which also makes them an attractive option. Compared to other types of financing, term loans can be funded quickly, sometimes in as little as a few business days. Term business loans can be secured through banks, credit unions, and online lenders. Online lenders can offer competitive rates, less strict requirements, and fast funding, thus making them an increasingly popular option. 

• SBA Loans: An extremely reliable source of term loans and other loan programs is the SBA. The Small Business Administration does not administer loans itself, but rather backs up loan products offered through partner lenders. The SBA is an independent agency of the federal government. To get an SBA loan you’ll need to find an SBA approved lender. Qualifying for an SBA loan requires a lengthy paperwork process, so prepare yourself.

• Commercial Business Loans: Commercial business loans are another popular type of business installment loan that allows companies to finance major purchases. This could include commercial vehicles, commercial real estate transactions, and even commercial construction costs. Banks, credit unions, and even online lenders may offer these loans.

• Business Credit Cards & Lines of Credit: One final financing option for business owners who prefer alternative means of funding besides a loan, is to use business credit. Many entrepreneurs actually prefer using a business credit card or line of credit for their expenses and purchases. This is because credit cards offer a few advantages when compared to business loans including faster approval as well as ongoing access to a revolving line of credit. If you can find a card with an introductory rate of 0% APR, this makes business credit an even more attractive (and smart) financing option.

Small business financing resources in North Carolina

There are a variety of programs and resources available to business owners located in North Carolina.

The U.S. Small Business Administration (SBA) is a good starting point for any business to take advantage of resources and information about financing options including loans, investment capital, disaster assistance, surety bonds, and grants. SBA-backed loans are a popular option for many entrepreneurs.

In addition, business owners in North Carolina can utilize the following resources:

• The North Carolina Small Business & Technology Development Center (SBTDC) is a resource for new and developing businesses in the state of North Carolina. Services include assistance with seeking equity financing, a variety of seminars and workshops, one-on-one business counseling, and a business start-up guide. The SBTDC also publishes a comprehensive guide to financial resources available to small businesses in North Carolina.

• The Carolina Small Business Development Fund is a nonprofit Community Development Financial Institution (CDFI) that exists to support small businesses in underserved communities. A dedicated team of Business Solutions Officers help business owners learn about and access capital solutions including loans and grants.

•  The North Carolina Small Business Center Network (SBCN) offers a variety of programs, services, and resources to help local business owners start and grow their business. They operate a Small Business Center at each of the state's 58 community colleges to help guide entrepreneurs through the process of starting and growing a new business.

• The Economic Development Partnership of North Carolina (EDPNC) helps new and existing businesses throughout the state of North Carolina. Services include free consultations with an EDPNC Small Business Advisor, assistance with finding sources of capital, and a variety of other small business resources.

• The North Carolina Rural Center administers several lending programs to small businesses in North Carolina including loans provided by Thread Capital. Small business loans in amounts from $500 to $100,000 are available. As a Community Development Financial Institution (CDFI), businesses can access capital, coaching, and other tools designed to promote economic growth in North Carolina. They also publish a guide to financing for small businesses in North Carolina.

• Lastly, the North Carolina Department of Commerce is available to help small businesses with a variety of assistance programs including data, tools, and reports, access to free small business advisors, and training resources.
• PrimeRates is another resource for North Carolina business owners. At PrimeRates, business owners can access personalized loan offers within minutes. Offers can be received with no credit impact, so whether you’re ready to take on a loan or just shopping, PrimeRates is a great resource to take advantage of.

Small business grants available in North Carolina

There are a variety of grants available to applicants in North Carolina. Grants are gifts of financial assistance designed to help business owners succeed and do not need to be paid back.

Many grant programs today focus on providing assistance to specialized sectors of the economy. For example, grant programs are available to help aid rural development or minority-owned businesses.

Small business grants can be obtained from government agencies, corporations, and organizations.

Local grant options in North Carolina include:

• The Carolina Small Business Development Fund provides access to grant funds administered to "historically underutilized" small businesses in North Carolina through a few different grant programs.

• The State Trade Expansion Program (STEP) Grant provides grants in amounts up to $15,000 to small businesses seeking to expand through international business development activities (such as attending trade shows or updating marketing materials for an international audience).

• Visit the North Carolina Department of Commerce Grants & Incentives page to learn more about options including the Job Development Investment Grant (JDIG) and the One North Carolina Fund (OneNC) cash-grant program.

• The Golden Leaf Foundation offers grants in agriculture, economic development and workforce preparedness, as well as educational assistance.

• The official website of the State of North Carolina operates a comprehensive guide for Grant Opportunities throughout the state of North Carolina which lists grant programs from various NC state government agencies.

• Likewise, the Currituck County Economic Development website lists some of the most popular small business grants available to businesses in North Carolina.

In addition to the grants listed above, business owners can also check state agencies, federal agencies like the SBA and USDA and even agencies at the municipal or county level as well. 

Tips for applying for a small business loan in North Carolina

Business owners in North Carolina should take advantage of the following tips when applying for a loan:

Consider your credit: It’s very important to check your credit score and verify the accuracy of the information on your credit report before applying for any loan, and business loans are no exception. Having a Prime credit score (660 or above) grants applicants access to the best loan offers and the lowest interest rates. If you have less-than-ideal credit, you can take steps to improve your score before applying or consider using a cosigner on your loan application.

Have a business plan: When applying for a small business loan in North Carolina or any other state, the most commonly requested item from lenders is a business plan. Not only does a detailed business plan help you qualify for a loan – but it also helps your company succeed. A good business plan includes several key elements including an executive summary, a marketing plan, a financial plan, and an operations plan.

Gather your paperwork: In addition to a solid business plan, most lenders that offer small business loans will ask for a variety of additional paperwork to verify information about your business. Be prepared by gathering this documentation ahead of time. You will most likely need to prove how long you have been in business as well as what your current annual revenue is. This is because many lenders have minimum requirements before they will approve applicants for a business loan. For example, some financial institutions want business loan applicants to have been in business for at least 1 year.  Financial documentation you might need includes: profit and loss statements, financial projections, earnings reports, tax returns, and bank statements.

Consider alternative lenders: Credit unions and online lenders can offer some of the best loan deals due to their decreased overhead. Business owners can take advantage of low interest rates and flexible loan terms by using these lenders. Credit union membership is typically based on your place of employment, education, or residency. Top-rated credit unions in the state of North Carolina include Navy Federal Credit Union, State Employees' Credit Union, Fort Bragg Federal Credit Union, Corning Credit Union, Alliance Credit Union, Mountain Credit Union, and Carolinas Telco Federal Credit Union. Online lenders may be easier to qualify and can often deliver funding faster too.

Compare rates and get funded

To compare rates and get the best deal on your North Carolina small business loan, check personalized offers at PrimeRates. By submitting one application, you can receive offers that your business actually qualifies for - without impacting your credit score. PrimeRates is committed to helping businesses thrive with a little help from our powerful network of lending partners. 

Unlock the best business loan offers in North Carolina. . . check offers online today!