Best Business Financing Loans for Oklahoma Small Businesses

Access to financing is one of the most significant challenges for businesses today. They may need capital to get them through a period of growth, seasonal fluctuations, or for major capital expenditures. Our Oklahoma business financing options include traditional bank loans, lines of credit, and those backed by the Small Business Administration (SBA).

We understand there isn’t a one-size-fits-all solution to business financing because every company is unique. Your best business loan options in Oklahoma depend on what the money is for, how long it’s needed, and where your business is in its lifecycle.

Working Capital Loans in Oklahoma

A working capital loan, also known as a business term loan, can be used to cover the day-to-day operating expenses of your business, such as making payroll, rent, buying inventory, or covering seasonal fluctuations in revenue. These can serve as short-term or long-term loans, although they’re typically used to cover short-term financing needs (six months to two years). They provide fast access and repayment flexibility without a long-term debt commitment.

These loans are used by early-stage businesses that need immediate cash flow support, and by growing businesses with seasonal revenue swings or unpredictable expenses. You would receive the proceeds as a lump sum. Business lines of credit and short-term loans can also be used as working capital loans, depending on the needs of your business.

Business Lines of Credit

With a business line of credit in Oklahoma, you would have a pool of funds that you can draw on at any time to meet several business financing needs. You would only pay interest on the funds you draw on until you pay back the loan. After that, you can draw on these funds again whenever you need, up to your line of credit limit.

Think of it as a business credit card, but with much lower interest rates. Lines of credit are favored by businesses that need the flexibility of accessing funds as needed, rather than receiving a one-time lump sum.

You can use a line of credit to meet numerous business needs, such as a source of working capital, to buy equipment, manage seasonal cash flow, and to cover your short-term operating expenses. Lines of credit are often used by businesses in their early stages and by growing businesses with seasonal revenues and cash flow.

Commercial Real Estate Loans in Oklahoma

A commercial real estate loan, also known as a commercial mortgage or a commercial construction loan, is a long-term financing option that can be used to buy vacant land or an existing building for your business. It can also be used to buy rental property such as a commercial building, a retail center, or an apartment complex.

These are typically used by established and growing businesses that are looking for a location to expand their operations or are ready to invest in rental property, to provide long-term financial stability and build equity.

When buying real estate, you would receive the proceeds as a lump sum payment. When used as a construction or renovation loan, you would make interest-only payments during construction, with the funds provided to you in stages as you complete each phase of your project. When the building is complete, your construction loan may convert into a regular commercial mortgage, and you will start to pay back the loan.

Equipment Financing in Oklahoma

A commercial equipment loan provides medium-term financing for a business that needs to buy equipment such as machinery, commercial vehicles, and computers. These are popular among growing and established businesses because whatever you’re buying with the proceeds serves as collateral to secure the loan. The term of the loan is typically aligned with the expected lifespan of the equipment.

SBA Loans in Oklahoma

The Small Business Administration (SBA) offers several types of government-backed loans designed for small businesses and startup companies that might have trouble obtaining a traditional bank loan. These loans are issued by local banks, with support from the federal government. The SBA’s Oklahoma office is located in Oklahoma City. As an SBA-preferred lender, we can offer fast decisions and approvals on SBA loans.

SBA loans are typically used as a financial bridge by both growing and established businesses that need longer repayment terms or larger funding amounts that they could obtain through a commercial bank loan. The two most common government-backed loans in Oklahoma are SBA 7(a) loans and 504 loans. You would have to provide collateral to obtain a 7(a) loan. With a 504 loan, you can use the equipment you’re buying as collateral.

SBA 7(a) Loans

These are one of the more popular small business loans in Oklahoma because they can be used to cover several business funding needs, such as a source of working capital, to buy equipment, acquire an existing business or farm, and buy inventories or livestock.

With a 7(a) loan, a qualifying business could borrow up to $5 million at fixed or variable interest rates, at terms of up to 10 years, which could be extended by a year if the proceeds are used to buy something with a useful life of 10 years or more. Terms of up to 25 years are available if the loan is used to buy real estate or improve business property.

SBA 504 Loans

A 504 loan allows a qualifying business to borrow up to $5.5 million at a fixed rate for 10 to 25 years. The proceeds must be used to buy something with a useful life of 10 years or more. This includes equipment, land, and business property. When a 504 loan is used to improve business property, the loan can provide up to 90% of the cost.

SBA Microloans

SBA Microloans are available at up to $50,000 for qualifying small businesses, and the proceeds can be used to help a business expand. They can’t be used to pay off existing debts or to buy real estate. Allowable uses include working capital or buying supplies, inventories, or machinery.

SBA Express Loans

With an SBA Express Loan, a qualifying business can borrow up to $500,000 for 10 years. The proceeds can be used as a source of working capital, to buy inventories and equipment, or to start a new business. These loans also offer quick approvals in as little as 36 hours.

How to Choose the Right Business Financing Option

When considering your options for Oklahoma business loans, there are a couple of key factors that could affect your decision. You’ll need to ask yourself:

• What is the primary purpose of the funds?

• How quickly will the investment generate a return?

• How long would you need to pay back the loan?

• Is this an ongoing or a one-time need for capital?

• How much working capital and other assets do you have that could be used to secure a loan?

• At what stage is your business in? Are you a startup, a growing company, or a stable company looking to expand?

While you might be anxious to secure a loan for your business, it’s important to take the time and consider your needs as well as your options. That’s why it’s important to have a good working relationship with a local bank that takes the time to understand your company, your goals, and can help you obtain the funding you need to grow your business.

Why Business Stage Matters When Choosing Financing

The stage of your business is an important factor when considering your business financing options. A company that’s been in business for several years has different needs than a startup with limited capital. A startup is likely to have a harder time obtaining a loan than a business that’s more established. Consider the three stages of growth and how they impact your financing needs:

Startups and newer companies will have limited business and credit history. They might have started with the owners dipping into their pockets and perhaps leveraging their own assets to obtain capital. A business at this stage is going to need flexible funding to cover its costs and is unlikely to have a revenue stream to provide the capital it needs.

In the growth stage, a company has an established revenue stream but may need additional funds to balance its cash flow and capital needs to expand the business. The company will find it easier to obtain loans and may be interested in mid to longer-term funding needs but might also need a bit of flexibility to deal with seasonal demand and to seize upon new opportunities, such as hiring more people or buying more equipment and inventory to meet a growing demand for their products or services.

When a business reaches the established stage, it’s probably looking for long-term investments and new opportunities. It will have larger obligations, but also the resources to manage them. An established business would likely find it much easier to obtain the loans it needs to remain competitive or fund an expansion.

We Can Help You Compare Your Oklahoma Business Financing Options

The “best” loan for your business depends on several factors, such as how much funding you need, whether you need short or long-term financing, how much flexibility you’re looking for, and how long you’ve been in business. For more information and help considering your Oklahoma business financing options, you can check out our Business Loans page for more information or contact us to speak with one of our business bankers to go over your financing needs and plans for growth.

 

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