Business Loans for Hispanics

Can hispanic and latino business owners obtain a loan?

Business owners of all ethnicities, cultures, and backgrounds are entitled to equal access and opportunities for financing and other business assistance in the United States. 

Loans are most commonly offered through community banks and credit unions, although they can also be found via the internet from alternative online lenders. Certain non-profit organizations may be able to help Hispanic business owners connect with sources of capital. We will review some of these organizations later on. 

What are the benefits of Hispanic business loans?

Any business loan or other type of business financing is going to be extremely beneficial to small business owners. Taking out a business loan can help entrepreneurs start a new business, expand an existing one, cover inventory costs, pay for upgraded equipment, or finance real estate purchases. Whether you use a business loan to cover payroll or pay for an unexpected emergency, having access to financing can help smooth over temporary gaps in cash flow and pave the way for future business success. 

Business loans are typically unsecured and are paid back in equal monthly installments with low interest rates that make payments manageable. 

Types of business loans for hispanics

There are a few different types of business loans that Hispanic business owners and others can take advantage of. We’ve outlined them below:

• Business Term Loans : As a form of installment loan offered by several different types of financial institutions, business term loans can be found at your local bank or credit union or via online lenders. They can also be found through online lenders. The SBA is another popular source of loans.
  • » MORE: Compare Term Loans
• Online business loans : Online lenders are becoming an increasingly popular choice for financing business loans. Applying for an online business loan is often simple and easy, and can be done in a matter of minutes. Approval typically takes a few business days (much shorter than other types of loans) and interest rates are often very competitive. To expedite the online business loan shopping process, check offers at PrimeRates. At PrimeRates you can access a network of some of the best lenders that specialize in business loans. If you qualify, you can receive a personalized offer from several of these lenders.
  • » MORE: Business Loan Options
• Microloans: Microloans are loans in smaller amounts that often also come with shorter repayment terms. Microloans may be easier to qualify for and can be a good option for new business owners just starting out or business owners with poor credit. Microloans are offered through the SBA in amounts up to $50,000 and via other private lenders.
  • » MORE: Microloan Information 
• SBA Community Advantage Loans: While the SBA offers several different loan programs through its network of partner lenders, the SBA Community Advantage program is a particularly great option for small businesses that may be struggling to obtain traditional financing. It’s designed to assist small business owners in underserved markets.
  • » MORE: Compare SBA Loans
• Business credit cards: Alternatively, business owners can take advantage of a business credit card or line of credit that can be used over and over again. Unlike a business loan, using credit gives business owners the option to access funds multiple times as long as they pay the balance off in full. Credit cards can be an especially good option for recurring expenses, large purchases, and emergencies - especially if you can find a deal on a card with a 0% introductory APR offer.
• Opportunity Fund: The Accion Opportunity Fund exists to support small business owners of any race, gender, or economic background. As a non-profit lender, the Accion Opportunity Fund allows for customized loan terms and low interest rates in loan amounts ranging from $5,000 to $100,000.  In addition to access to capital, the organization provides business owners with networking and coaching opportunities. 
• Kiva: The Kiva lending program helps crowdsource access to lending via a community of small investors. As a non-profit organization, Kiva offers business owners and entrepreneurs a way to obtain capital without having to go through a traditional bank or loan program. Kiva loans come with 0% interest and are available in amounts of up to $15,000 to U.S. applicants 18 years or older.

Do Hispanic business grants exist?

Grants are a form of financial assistance that does not have to be paid back. This makes them a popular option for many small business owners. Grants are typically offered by government agencies, non-profits, large companies, and other organizations. Many grants are targeted specifically to certain segments of the population such as the Hispanic community. Hispanic business owners should consider the following options:

• The Minority Business Development Agency (MBDA) helps minority-owned businesses obtain grant funding via the MBDA Business Center program. Grants are usually distributed annually with applications accepted in the spring or summer. 
• Although open to any eligible small businesses, the USDA Rural Business Development Grant assists many Hispanic-owned businesses each year. Funds are distributed to businesses in regions that lie outside a population center of 50,000 or more.  
• Small business grants of up to $4,000 are available for small businesses through the NASE Growth Grants program. These grants are issued to business owners regardless of race, gender, or background. 
• The U.S. government runs a comprehensive database of grant programs available to business owners across the United States. Access these opportunities at Grants.gov. 

Tips for applying for a small business loan

Applying for a small business loan, especially for the first time, can seem like a daunting task. But don’t let the fear step you, applying for a business loan can be much quicker and easier than you think.

• Gather documentation beforehand: In order to help the process run smoothly, business owners should be prepared to submit information about their business during the loan application process. Some lenders may have minimum requirements such as a minimum length of time in business (usually 1-2 years) and a minimum annual revenue. Documentation requested may include articles of incorporation, financial projections, tax records, and bank statements. Having these documents gathered ahead of time can save time during your loan approval. 
• Check your credit: When applying for a business loan, lenders may check your personal and/or business credit. Therefore, it is important to be aware of your score and other information on your credit report before applying. This allows you to check for any errors and make any necessary moves to increase your credit score. The higher your credit score, the more money you can save on interest over the lifetime of your loan.  
• Have a business plan: In addition to the other supporting documentation listed above, every business owner should have a solid business plan. Having a business plan not only helps your business succeed but helps improve your chances of qualifying for a business loan.  
• Get prequalified : Compare rates and shop around for the best loan terms by viewing offers from a wide selection of different lenders and getting prequalified with a few. Once you have a better idea of what your interest rate and other loan terms will be, you can narrow down your search and select a winner. 

Other helpful resources for hispanic and latino business owners

Latino business owners and entrepreneurs can take advantage of the following resources designed to help their businesses succeed:

• • Minority Business Development Agency: The MBDA is a part of the U.S. Department of Commerce and focuses on connecting business owners with capital, contracts and other assistance. Business owners can visit MBDA Business Centers in various locations across the U.S. to get information and other resources. 
  • National Minority Supplier Development Council: From the creation of a new business fund designed to assist minority-owned enterprises to a certification program for minority business executives,, the NMSDC offers a variety of financial, educational, and networking opportunities for Hispanic business owners. 
  • U.S. Hispanic Chamber of Commerce:  More than 200 local Hispanic chambers of commerce and other business organizations across the U.S. work through the USHCC to develop programs that help Hispanic business owners. Technical assistance and training are available as well as networking events, access to capital, and other resources. 
  • The National Hispanic Business Group: The NHBG exists to support Hispanic business owners through events and other networking opportunities, business connections, and a scholarship program. 
  • LULAC: As one of the largest Hispanic-focused organizations in the United States, The League of United Latin American Citizens (LULAC) has compiled a list of resources for entrepreneurs and has created the Latina Entrepreneur Academy (LEA) specifically for Hispanic women. 
  • Latino Business Action Network: The LBAN exists to empower Latino entrepreneurs. Resources available from this Stanford University initiative include podcasts, mentorship programs, webinars and other educational programs, and networking opportunities. 

• Small Business Administration: The SBA Learning Center offers a variety of free training courses for all business owners to take advantage of online.  In addition, the 8(a) Business Development program further helps Hispanic-owned businesses by boosting access to certain contracts. 
• SCORE: SCORE has helped many Hispanic-owned small businesses succeed through their resources including webinars, workshops, mentorship programs, and educational blogs.

Closing thoughts

No matter what type of financing you choose to pursue, a little bit of research and effort can go a long way towards the future success of your business. Most financing options today are available to business owners with just a few clicks online and a simple application. Consider shopping around and even getting prequalified to find the best deal. 

Apply & compare rates with PrimeRates

Time is an extremely valuable resource in life and in business. Securing a business loan can consume a lot of time, but there are ways to go about the process more efficiently. At PrimeRates you can receive personalized business loan offers that you actually qualify for in a matter of minutes. Your credit score will not be impacted by checking offers, unless you decide to accept an offer. Once you’ve found the business loan that meets all your needs and budget, you can finalize the loan with the lender and receive funds quickly.

Unlock the best business loan offers in minutes. . . check offers at PrimeRates today!