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Small Business Loans in North Carolina (2021 Update)
There are almost one million small businesses in the beautiful state of North Carolina. Many North Carolina entrepreneurs require business loans to get their ideas off the ground. North Carolina offers grants and state-issued tax breaks for people who own their own companies and are self-employed. These essential grants, with the help of a small business loan, allow North Carolina corporations to thrive.
How Small Business Loans are Used
Small business loans are used for a variety of company-related endeavors. Some owners take out a loan because their businesses are struggling to stay afloat and they need a saving grace to prevent bankruptcy. Others use their loans to expand on their companies and provide upgraded services to their customers. Before choosing to take out a loan, you’ll want to create a plan for the money. Know how much you’ll need as part of the loan and what the money will be spent on.
When and How to Apply
It’s recommended that you wait until your company is fully established before applying for a business loan. Most lenders won’t even approve loans for brand new businesses, as eight in every ten companies fail within their first year. If you do get a bank that approves your new business loan, you’ll often have a ridiculously expensive interest rate attached. The lender will want a list of your business sales, expenditures, losses and bank accounts to determine eligibility. A company that is considered high-risk or is working in a niche market may be denied a loan due to its risk factor.
Applying for a loan is relatively easy once you find a good bank and have a fully-realized company that has potential for growth. Most loans are approved within one or two months and repayment starts immediately upon approval.
Getting a Good Rate from a Bank in North Carolina
Before signing on the dotted line, make sure you’re getting a good rate for your small business loan. In North Carolina, average loan rates range from five to nine percent. If you have a high-risk company or poor credit score, you’ll typically be approved at a higher rate. Variable rate loans are more readily available and can reduce monthly payments, but there is no guarantee that your interest rate will remain low for the entire term length.
Banks in North Carolina That Offer Small Business Loans
Below are the six top performing banks in North Carolina for small business loans:
Union Bank and Trust Co.
Union Bank and Trust Co. was found in 1917 in Lincoln, NE but has since branched out to other locations including Oxford, North Carolina.
A commercial bank based in Creve Coeur, Mississippi, First Bank first operated in 1906. Since then, it has opened offices in other states. In 2013, it loaned a total of $618 billion to small businesses in North Carolina.
First-Citizens Bank and Trust Company
A state-chartered commercial bank, First-Citizens Bank and Trust Company has helped small businesses in the state with $3.82 billion in loans in just one year.
Founded in 1968, the Yadkin Bank provided community banking services in North and South Carolina up until it was acquired by the First National Bank of Pennsylvania.
Bank of Oak Ridge
Founded in 2000 in Oak Ridge, North Carolina, the Bank of Oak Ridge managed to be included in the list despite being relatively new in the business.
The Fidelity Bank
In just one year, The Fidelity Bank has successfully aided small businesses through $331 billion in loans.
The Difference Between a Business Loan and a Personal Loan
It might be tempting to take out a personal loan if you’re afraid of being denied a small business one. Personal loans are tied up in a person’s credit and collateral. If your business should fail after taking out a personal loan, you’ll still be responsible for paying back the loan. Business loans, on the other hand, utilize the capital of a company if the business should fail. If your company goes under, the lender will take value from your corporate assets to repay the loan and you can get away unscathed by collectors.
Top Cities in North Carolina and Their Lenders
North Carolina is a wonderful place for a new business owner to start a company. The state isn’t overly expensive, and there are a wide variety of industries that have excelled in the region. Agriculture, services, and energy industries all play a major role in the state’s economy. The climate is relatively mild, which also means that certain industries will thrive year-round. If you’re looking to start a business in the area, you’ll want to choose the right city.
in this portion of the article, we’ll take a look at the various cities you can head to if you want to start a new business in North Carolina. We’ll also provide you with each city’s top lenders.
Charlotte, North Carolina
Charlotte is the largest and most famous city in the state of North Carolina. Charlotte is actually one of the largest financial centers in the United States. It has the third largest banking presence behind New York City and San Francisco. If you want to start a business where you’ll have plenty of access to capital, this is a good spot. Below are our favorite lenders in the area:
First Bank is a regional lender that has a presence in the Charlotte area. They’re great at helping you get the most out of your financing experience. They also provide full-service business banking services if you need to take your business to the next level. They’re a great one-stop-shop for all your financial needs.
BEFCOR is another of our top picks in the Charlotte, North Carolina region. This non-profit organization provides SBA loans to their customers. They may not have the widest variety of loans available, but they certainly allow you to cheap access to SBA financing. They’re a great partner if you’re thinking SBA loans are right for your business.
Raleigh, North Carolina
Raleigh has one of the most diverse economies in the state of North Carolina. Finance plays a major role in the local economy, as well as retail and telecommunications. It’s a great place to move for small business owners as it has plenty of infrastructure for incoming business owners. Below are our favorite lenders in the region:
As mentioned previously, BEFCOR is a great lender if you’re looking for affordable SBA loans. They provide their clients with access to traditional SBA loans at great interest rates. They’re a non-profit organization that is dedicated to providing their client base with easy access to capital. If you want to work with a local lender that cares about your business and its success, BEFCOR is most definitely one of your best options!
Coastal Credit Union
Coastal Credit Union is a small, regional credit union that has the ability to take your business to the next level. Like BEFCOR, they offer loans at very affordable interest rates. They have clients throughout the state, so you can be certain they’ve worked with every type of industry you can imagine.
Greensboro, North Carolina
Greensboro is a manufacturing hotspot in North Carolina. It’s one of the top places in the country for the tobacco industry. The area also has a University of North Carolina campus. It’s a great place to move for young families. Below is our favorite lender in the Greensboro area:
Bank of Oak Ridge
Bank of Oak Ridge is a large, regional lender that provides both personal and business banking services. If you’re looking for a lender that has local experience without sacrificing strength, this should be one of your top choices. They have a great reputation in the area.
Durham, North Carolina
Durham is home to Duke University, which is one of the largest employers in the area. As one of the top universities in the country, Duke attracts a range of research institutions to the city. It can be a great place to start a business for a number of different industries. Below is our top lender in the area:
Durham Commercial Capital
If you’re looking for a commercial lending expert that has an understanding of Durham’s unique economy, Durham Commercial Capital should be your first port of call. They have a great understanding of the local economy and they specialize exclusively in commercial capital. They also do accounts receivable purchasing.
Winston-Salem, North Carolina
Winston-Salem is the home of Wake Forest University. This small city benefits from the students who live in the area. Summer times can sometimes bring less revenue as students leave the city for the holidays. Winston-Salem is also a hotspot for the tobacco industry. Below is our top lender in the area:
Winston-Salem Federal Credit Union
Winston-Salem Federal Credit Union is our top pick for the area of Winston-Salem. It’s a great lender that has an extremely deep understanding of the local city’s economy. You’ll be able to get some of the most affordable rates on the market if you head to Winston-Salem Federal Credit Union.
Remember, some of these companies or banks are very specialized and may only handle SBA loans or a business line of credit. Ask them about any special programs for minorities or women. Also ask for information about business grants for startups if that interest you. If you bad credit don’t worry as there still may be other alternative lenders willing to work with you.