Whether it’s to expand a business, attract new talent or get a start-up off the ground, it might be time to consider a business loan if costs outweigh your capital. Our partners at ConsumerAffairs researched the best business loans in Detroit to help you start or expand your company with the right lender.
Detroit is alive with entrepreneurial spirit, and the area’s most prominent players are doing their part to support an atmosphere of innovation through business incubators, networks, venture capital and loan programs. If you have a good idea and are willing to work hard, Detroit has the professional networks, support systems and access to capital needed to make your business a reality.
To go along with this entrepreneurial wave, Detroit has a multitude of lenders, investors and programs that aim to support new businesses and start-ups. There are many types of business loans available, and different factors determine which is correct for your company. Some of the available loans are:
Expanding, established businesses with good credit
Cash upfront; offered by banks and online lenders
Often requires collateral; costs vary by lender
Established businesses refinancing existing debts or purchasing property
High borrowing limits; long repayment terms; low rates
Long wait times; extensive qualifications
Business line of credit
Short-term business needs and unexpected expenses
No collateral required; no interest on unused funds
Requires consistent revenue; often includes multiple fees
Businesses that need to purchase new equipment
Competitive rates; builds equity; secured by purchased equipment
Down payment usually required
Accounts receivable financing
Businesses with accounts receivable or unpaid invoices
Provides quick cash
Can be costly compared to other options
Merchant cash advance
Businesses with a consistently large volume of credit card sales
Fast cash; doesn’t require collateral
High interest rates; intense repayment schedule
Start-ups and small businesses
Low costs; often comes with additional services
Smaller loan amounts
Many lenders provide financial advisors who can help you determine which type of loan is right for your company. When comparing loan offers, be sure to consider any fees that come with the loan.
Business lines of credit often charge draw fees, while term loans might include an underwriter fee for verifying your information and a loan-packaging fee if you’re approved. Before taking out a loan, inquire about all costs and fees, and know your rates and repayment schedule.
A good way to compare loans is by using the annual percentage rate (APR). Unlike the interest rate, the APR also includes all fees that you might incur with the loan.
Programs to help start-ups in Detroit
If you’re starting a new company, Detroit has many programs that will help provide advice, mentorship and funding. Some of these programs are:
TechTown offers multiple programs to help tech start-ups and business owners starting or expanding a retail business.
Automation Alley helps manufacturers take their businesses to the next level through a diverse collection of partnerships.
For quick funding without restrictions, Detroit residents can turn to Seek Business Capital. Their online application process provides estimates in a matter of hours, and the company has a 92 percent funding approval rate for qualified applicants. Customers in Detroit love the quick and easy service and friendly staff.
Imperial Advance has 25 years of experience in the business loans industry and an extensive network of lenders. Imperial Advance offers great rates and flexible terms to qualified applicants and makes funds available within 24 hours. Detroit customers love the company’s knowledgeable employees.
National Business Capital
National Business Capital advises entrepreneurs and connects them to capital to help them succeed. They provide a variety of business loans, an easy application process and funding in 24 hours. The company will work with borrowers with low credit scores. Customers in Detroit appreciate the fast service and regular updates on their loan status.
Detroit Development Fund
This nonprofit is a certified community development lender with a mission of revitalizing Detroit. DDF offers loans for local entrepreneurs and small businesses. The nonprofit has a lengthy application process but provides loans to business owners who have been unable to access traditional funding. Past borrowers say DDF believed in them when no one else did.
Offering microloans ranging from $15,000 to $25,000, ProsperUs Detroit has financed more than $500,000 in loans to neighborhood entrepreneurs. ProsperUs Detroit also offers entrepreneur training courses and access to affordable business services. Detroit residents love the training and lending services provided by this organization.