Celtic Bank Blog


SBA Loans: What They Are, How They Work, and Why They're Perfect for Buying Your Business

So you’re thinking about buying a business. There are a lot of different options for making that purchase. How do you know which to choose? We’re here to show you the ins and outs of one of the most accessible, affordable, and all-around best financing options for buying a business—the SBA loan. You’ll learn what it is, why it’s a great option, and what you need to do to get one. There’s a lot to cover, so let’s get started! Why SBA? There’s a million options out there for buying a business. Bank loans, short term loans, SBA loans—not to mention seller financing, and private investing. When you consider all the choices, it may seem like a buyer’s market. But is it? Some loans come with steep and costly repayment packages which ultimately may hurt, not help, the growth of your business. Even if the business you purchase is healthy and thriving, if you get it at a cost you can’t actually afford you won’t stay in business long. So you could get the money from just about anywhere. But do you really want to? We’re going to look at SBA loans, and why they leave their competitors--the traditional bank...

Tax Breaks, Equipment Deductions, and More: How to Use Trump's New Business Tax Reforms to Expand Your Small Business

Since President Trump took office almost two years ago, the media has exploded with stories, press releases, and memes about the tweeting Trump. But how have his policies—especially his tax reform policies—really impacted the growth of your small business? Nine months in, and sorting past the noise of the news, let’s take a look at what the 2018 tax reform means for different small businesses all over the country. Tax Reform (and why it’s a big deal) Before we jump into the nitty-gritty, it’s important to point out how huge these changes really are. Trump’s tax reforms are the first large tax reform initiatives since Reagan … over thirty years ago! Which means you can’t expect your business to run status quo anymore. Things you’re used to deducting may not be deductible anymore. And improvements that have seemed just too expensive may actually help you save on your yearly bill from Uncle Sam. Knowing what has changed can help you leverage these new laws to your advantage—capitalizing on the growth these changes were designed to create. And while the thought of taxes usually makes us squirm—depending on your business structure and the tax, you may actually find a few of...

The Five Stages of Equipment Financing—From Application to Approval

Depending on the financing option you choose, your timeline for getting equipment financing will vary. But generally, the process of applying and getting funding for an equipment loan is quicker and easier than the process for getting a traditional loan. We’ll go over each stage of the application process, and show how timing can change depending on your options. 1. GATHER YOUR DOCUMENTS If you decide to lease your equipment, your paperwork process will be minimal. Many equipment lenders are able to gather what they need from a one-page application. If you go with an equipment loan, your paperwork will be light, too. With an SBA loan, the paperwork process can be more involved. (Granted--your loan size is usually much bigger for these loans, so you can expect that the lenders will want to know a little more about your situation before approving the loan). Have a couple things on hand when you start your initial application, like: Profit and loss statements and balance sheets Financial projections Ownership and affiliations Business certificates and licenses Loan application history Personal and business income tax returns (3 years worth) Resume Business overview and history Bank Statements Schedule of business debt Whichever route you...

Four Business-Building Equipment Loan Categories You May Have Overlooked

Some people think “equipment loan,” and they think construction equipment, industrial machinery, or heavy-duty commercial kitchen appliances. But did you know that you can also get equipment financing for a broad range of other uses, too? Whether you need machinery, technology, transportation, a new POS system or more, equipment loans can be used to purchase a lot of different types of equipment. Here are some other ways small business owners (like you!) are using equipment financing to grow their business: UPDATE TECHNOLOGY Whether you’re looking to switch from bulky desktop systems to laptops, or just revamp your medical billing process, keeping your company’s technology current gets expensive—and fast! You can pay for it all upfront—obliterating your savings for the next year. Or you can get a generic long-term loan which, by the time it’s paid off, will be for equipment that’s now, again, out of date. Smart business owners keep technology current and preserve much-needed cash by financing their equipment instead of buying it outright. The specialized loan and leasing options keep costs affordable and the equipment current, too. STABILIZE CASH FLOW Let’s say you’re looking to purchase some new equipment. And you can actually afford the full cost of...

Equipment Finance Think: Scenarios to Test Your Practical Knowledge of Equipment Financing

How well do you understand equipment financing? Time for a little pop quiz! Let’s take a look at how three of the most common equipment financing strategies play out in the day-to-day runnings of your business. Keeping in mind traditional equipment loans, leases, and options like SBA 7(a) loans and lines of credit, read the following examples and determine which financing strategy you would recommend for the situation. Then, check your answers against those of our equipment financing experts! As you read each case, consider the amount of money needed, when it’s needed, and the type of equipment to decide which loan option will work best for you. If you need a refresher course, check out our post, Six Cash-Conscious Ways to Finance Your Equipment . Or, for an even more in-depth look into these equipment financing strategies, download our full, free guide,  Equipment Financing: A Small Business Owner's Guide to Loans, Leases, and Lending. Scenario 1: The POS System Rehaul You own a thriving eight-pump gas station and convenience store in a small South Dakota town off the main interstate. Business is great, but the new EMV chip card regulations are requiring some expensive changes for your station. Your...

Six Cash-Conscious Ways to Finance Your Equipment

When it comes to financing your equipment, there are different options to consider. You could use a loan, a lease, a line of credit, or even a business credit card. Having so many options can make researching your next upgrade overwhelming, but it’s worth your time!  Let’s take a look at the difference that using the right financing can make: Over the past few years, Melanie has financed five new delivery trucks on three-year terms. The payments have gotten pretty big, which means her cash flow gets uncomfortably low at certain points of the month. So she applies for refinancing—consolidating her payments into one new loan with a term of seven years. This gives her a much better cash flow and the money she needs to invest in and grow her business. By taking the time to reevaluate her equipment financing, Melanie was able to find an option that put her business in a healthier, more stable position. While there are many different options for your equipment financing decision (for a complete list, see Equipment Financing: A Small Business Owner's Guide to Loans, Leases, and Lending ), most options tend to fall into one of two categories: loans, or leases....

A Simple Starter on Equipment Financing for More Cash and Less Tax

Are high equipment rental or repair costs eating away your profits? The right equipment can be vital to the success of your business. But when it isn’t financed correctly, pricey payments can take your hard-earned cash flow to uncomfortable lows. Soon, the money you invested to grow your business is going back into paying off the loan, and you’re left with little funding to expand. So how do you know which equipment financing option to choose? Should you buy or lease? If you buy, what type of loan should you apply for (SBA, term, equipment…)? And if you lease, which of the many lease options should you choose? It can all get overwhelming… fast! We’re here to help you understand clearly what your options are and make the most fiscally-sound decision for your business. In this introductory post, we’ll cover how the right equipment can grow your business, what equipment financing can be used for, and when it’s beneficial to do so. (And if you're looking to go deeper, check out our free, downloadable guide:  Equipment Financing: A Small Business Owner's Guide to Loans, Leases, and Lending .)  EQUIPMENT MEANS GROWTH Remember those people you knew growing up—the ones who...

Six Things Small Businesses Can Do to Attract and Keep Employees—WITHOUT Spending a Fortune on Salaries

With the unemployment rate at its lowest since April of 2000 , employers are left scrambling to find enough people to fill positions. And though small, midsize, and large companies alike are feeling the sting of the workforce shortage, small business owners face some particularly difficult challenges. To help attract top talent, larger companies are offering salaries well above what small businesses can reasonably offer. Meanwhile, many small businesses struggle to provide basic benefits like health insurance—let alone the bigger benefits provided by many large corporations. So what’s a small business owner to do? Well, before you throw in the towel thinking all is lost, there are some things your business can do to attract and keep talent that don’t cost much (or anything!). Be flexible with scheduling Some large corporations have employee handbooks the size of dictionaries! They meticulously outline overtime, scheduling, and time allowed for breaks. Small businesses often find themselves at a polar opposite: an unwritten code of conduct. And that spells opportunity. Enabling employees to take a morning off to chaperone a child’s field trip, an afternoon to get a head start on a long road trip, or a shifted early-off day once a week to...

Three Steps to Choosing the Perfect Working Capital Loan for Your Business

Knowing which loan to accept can be tricky. What type of loan should you get? And where from? What should you be asking your lender so you don’t have any unwelcome surprises during the application process? We’ve broken the process down into three stages to help you ask the right questions and get the right loan: choosing your loan, choosing your lender, and choosing to accept your loan offer.   CHOOSING YOUR WORKING CAPITAL LOAN   Finding the right loan starts with asking the right questions. Here are some things to ask yourself as you consider getting your next working capital loan: What do I want to do with the money? Certain loans have restrictions on how you can use the money. For example, SBA loans can be used to help with renovation and construction projects, but the type of project will determine which SBA loan programs you can or can’t use. Private lenders may also specialize in funding only certain industries. Check with your loan provider to see what regulations they have on your loan use before applying. How much money will I need? Depending on the size of your loan, some options will work better than others. For...