It may be no surprise, but New York has been ranked as among the top five most entrepreneurial states in the US. The business climate in the state is friendly toward small businesses, and there are plenty of resources to help them get up and running. Entrepreneurs flock to New York City, Buffalo, Rochester, Albany, and all points in between to live out their dreams of running a business.
But sometimes those businesses need a little aid in getting off the ground or soaring high. That’s where small business lending comes in.
What is Considered a Small Business in New York?
While the Small Business Administration has its own definition of what a small business is (one with 500 or fewer employees), New York state has its own definition.
Small businesses in the state are those with 100 or fewer employees. Why does this matter? Small business owners applying for loans or grants may need to meet certain criteria (we’ll cover that later in this article), including the size of their business.
Small Business Loan Options New York
Now let’s look at some of the small business financing options you have in New York.
Coronavirus Pandemic Loans
Though some of the programs designed to help small businesses get back on their feet, both in New York and the rest of the country, are now closed, here’s an overview of what was available.
At the federal level, both the Paycheck Protection Program (PPP) and the Economic Injury Disaster Loans provided financial relief to small businesses.
At the state level, the New York Forward Loan Fund (NYFLF) may still be open to New York state businesses looking for financial aid. Check the link to get the latest updates.
Business lenders like traditional banks, credit unions, and online lenders offer longer-term loans with low interest rates to small businesses with great credit.
The U.S. Small Business Administration is another resource for financing with long-term, low-interest loans. Learn more about programs like the SBA 7(a) and 504 loans at SBA.gov.
Lines of Credit
When you don’t need a lump sum of cash all at once, a business line of credit can be helpful because you can borrow from that line a little now and a little later. When you pay back what you’ve borrowed, it’s available again to borrow from.
If you’re specifically looking for financing to purchase equipment like computers, machinery, or company vehicles, there are equipment loans that can help. With these, interest rates may be lower because the equipment you’re buying acts as your collateral.
Having one or more business credit cards can be valuable for making purchases like office supplies. Look for a card with a 0% APR introductory offer and a great rewards program.
Even if you don’t have good credit, there are short-term loan options that will get you the capital you need. Note that these tend to have higher interest rates and shorter repayment terms.
How to Qualify for a Small Business Loan in New York
Eligibility for the different types of financing we’ve discussed will vary among lenders. Existing businesses with solid credit may find it easier to qualify for bank and SBA loans than startups.
If your business is new and you don’t yet have a credit profile, you may want to learn how to establish business credit so that you can qualify for better offers and lower rates.
How to Apply for a Small Business Loan in New York
Loan applications will also vary in complexity, from one lender to another. Online lenders tend to have short applications, requiring little more than a few details about your business and annual revenues.
SBA and bank loans may require more details, such as tax returns, financial statements, and a business plan.
If you don’t have a business plan, look to business resources like the New York Small Business Development Center, which can provide technical assistance and help you develop a business plan at no cost.
How to Choose the Right Loan Option for Your New York Business
With so many funding options, it can be difficult to know which is right for your NYC business.
Start by researching which small business loans you qualify for, then look for the one with the lowest interest rate and best overall terms. But also look for reviews of the lender to see what they’re like to work with.
Nav can help you find the right small business loan to boost cash flow. Compare lenders and offers all in one place today.