Our goal at Lending Valley is to provide all small business owners access to the best loans possible for their business. You can rest assured we will get you the best rates in the market!
Located in the midwestern and northern regions of the United States, North Dakota is a sparsely populated state. The major contributors to its economy are agriculture, petroleum, food processing, and technology industries. The state has an impressive personal income growth. Moreover, North Dakota is the only state with a state-owned bank. The unemployment rate has also been very low since late 2019. North Dakota small businesses also play an important role in keeping the economy of the state steady. There are more than 73,000 small businesses in the Peace Garden State, which covers about 98.8 percent of all Dakota-based businesses. On the other hand, Dakota small business loans offers various options for small businesses in difficult situations, helping the economy of the state in a way.
With various of options, it is up to the business owners in North Dakota to find the best lenders to help them finance their business.
Conventional Bank loans are the first choice for North Dakota businesses as they offer the best rates. Moreover, lenders will look for business owners with collateral, high sales volume, and good credit. They are mostly utilized by North Dakota small businesses to take hold of other businesses, purchase commercial real estate, refinance a business mortgage, help with expansion financing of other businesses, and offer small businesses working capital. Loans of this type have 1 to 5 years repayment options with relatively low rates.
Small Business Administration’s (SBA) lending program is also a great option as it is backed by the government. This means, when a North Dakota small business defaults, an SBA loan reduces the lender’s exposure to losses as the government helps to compensate for most of their losses. SBA loans are specifically designed for small businesses to get a strong hold in the market. This is why SBA lenders provide this service especially for small businesses as it minimises the risk. However, being controlled by the government, the process requires a lot of paper work. The government collaborates with banks, community workers, and micro-lending institutions to provide loans to companies. SBA loans are ideal for North Dakota small businesses. Loans of this type are offered at varying rates with 10 to 25 years term. SBA 504 and SBA 7a loans are the most common lending options in North Dakota. The process takes about a month.
Invoice Factoring is a business-to-business transaction that allows a company the potential to leverage unpaid 30, 60- and 90-day invoices to gain specialized short-term business financing before the customer actually pays the invoice. North Dakota small businesses receives much needed working capital to help with cash-flow at a feasible rate. Invoice factoring offers a very hassle-free process which requires much less paperwork than any traditional loans. Moreover, no credit check is required.
Cash advances are not actually any kind of business loans as they are business-to-business transactions where the small business sells a small portion of their future revenue to a much more established company in expectation of more efficient profit. This makes it possible for a small business in North Dakota to get funded with a merchant cash advance even if they have a bad credit. Cash advances include long-term merchant cash advances, bad credit cash advances, additional position cash advances, and advances used for consolidation, which are repaid by either making a remittance to the cash advance funding company, or by having a set amount automatically sent to the funder using Automated Clearing House transaction via the business’s bank account. Cash advances are offered at varying rates.
Purchase order financing is a funding option for businesses that do not have the working capital to execute purchase orders. The lenders will provide the companies the much-needed capital so that they can pay the suppliers and vendors. This type of financing is mostly utilized by North Dakota small businesses.
Due to the sparse population, it has become difficult for North Dakota businesses to reach a larger market and strategize the most cost-effective way to transport their goods or services over a larger area. Moreover, it becomes a little difficult for businesses to recruit skilled workforce.
It has also become a struggle for businesses to keep their staffs employed in their companies which is a consequence of the oil boom. This is also an impact of how low the population of North Dakota is.
Business lines of credit is a kind of small business loan that offers flexibility which usual loans does not offer. This type of loan is best to compensate for expenses that tend to fluctuate throughout the course of the year. Line of credit is offered by banks in North Dakota at revolving terms and the process can be completed as quick as 24 hours.
New or used business equipment can also be financed in many ways through equipment financing. While some North Dakota small businesses will find it easiest and most affordable to obtain a term loan or other type of lending facility to purchase business equipment, other small business owners may find that the best way to obtain the equipment is to lease rather than buy. This is because leasing reduces the amount of cash that would be required instead of leasing equipment. By leasing, the company won’t be forced to pay the full-price for the equipment upfront. On top of that, they will be provided with updated equipment.
Term loan is another form of loan which is paid in instalments over a set period of time. Term loans can also be used as acquisitions, and consolidations and refinancing business debt. This type of loan offers varying rates.
Documents required to get a small business loan in North Dakota
North Dakota is said to be the best state in the United States for small businesses due to its pleasant economic business climate. Moreover, a range of lending options makes it much easier for North Dakota small businesses to thrive.