When applying for a small business administration (SBA) loan in Ogden – a service provided by firms such as Wasatch Peaks Credit Union – it is a requirement that you make a down payment on the loan.
This initial payment is an indication that you are serious with taking out an SBA loan and determined to repay it. Usually, the down payment is about forty percent of the total loan amount.
So, how do you get to raise the down payment?
Hard Money Loan
A hard money loan is one that you offer real estate property as security. Although the interest rates are high and repayment period short, you will receive your money faster.
It is wise to keep some money aside every month as savings. These savings could come in handy when you need to access cash fast. Remember to refund the money in your account to avoid disrupting your financial progress.
Get a Partner or Investor
Another party can come in and offer the finances you need against partial ownership of your company. Some partners or investors, however, would prefer giving you the cash and refund it once you get the money.
If your business has assets, you can sell them off to acquire the down payment. You could also engage a third party to enable the faster sale of the assets.
If your property’s value has increased, and the mortgage rates are low, you can consider refinancing to get some cash. You can also refinance other items such as your car.
Borrowing from Friends and Family
You can take advantage of your social circle to get the amount of money you need. Ask friends and or family for the required down payment and promise to pay it back in time.
The fact that you are borrowing money could mean you do not have enough at your disposal. However, it is a requirement to put a down payment before taking out an SBA loan. Consider the above ways to get the down payment early enough before contacting your lender.