Current Small Business Administration statistics indicate there are around 73,298 small businesses in Alaska. This makes up 99.2% of all businesses across Alaska. Lending institutions in the Alaska District granted 82 small business loans. This was during the last financial year and totaled $35.9 million.
| At a glance —Financial analysis shows Alaska as the best state to get a business loan. This state views small businesses as integral to the economy. However, finding the best option for Alaska small business loans can be overwhelming. In this review, we’ll provide you with clarity and the top traditional and alternative loan options. We will also look at the small business loan requirements in Alaska and how to get a small business loan in Alaska. |
First National Bank Alaska is the Alaska 504 Loan Lender of 2020 due to their Small Business Administration 504 loan program. This program issued loans totaling approximately $12 million.
They’re well known as a preferred lending partner, which means they can process your application faster than lenders that are not part of the SBA Preferred Lender Program.
Their Small Business Administration 504 loan program provides financing of up to $5 million. Financing may be used to buy fixed assets like real estate, buildings, or machinery. The program offers rates below the market rate and various repayment options.
The loan amount is distributed across three entities. The applicant or owner provides a minimum of 10%. A selected conventional lender like a bank provides 50% and a Certified Development Company, which is a non-profit organization, provides 40%. The owner, therefore, gains more working capital to grow their business.
Wells Fargo Bank NA was the winner of the Alaska Small Business Administrator Lender of the Year award. They issued loans of about $8.4 million and are considered one of the best banks for typical and SBA loans in Alaska. They’re part of the SBA Preferred Lender Program and can therefore process applications faster than other lenders.
They offer long-term financing for businesses with a net worth of less than $15 million and an average net income of less than $5 million. Fixed or variable interest rates apply.
The Wells Fargo SBA 7(a) loan is suitable for acquisitions, buy-outs, expansion, and buying real estate or equipment. All can be combined into a single loan of up to $5 million.
The SBA 504 loan is suitable for business expansion through land or building acquisition, construction, or equipment purchase. Loans go up to $6.5 million for the portion from Wells Fargo and up to just over $5 million for the portion funded by a Certified Development Company.
This is a not-for-profit, member-owned financial services cooperative. They were founded in 1948 with branches in Alaska and other states in the USA.
Alaska USA offers a full range of financial services and SBA Loan programs:
Interest rates and fees may differ based on the loan program selected, borrower credit score, and loan amount and term. Loan eligibility criteria also differ based on the loan program selected.
Alaska Growth Capital BIDCO, Inc. is a non-bank lending company based in Anchorage, Alaska, and has been appointed SBA Community Lender of the Year nine times. It was founded in 1997 to promote economic development and job creation. They offer loans, investments, and managerial assistance to businesses.
AGC provides a varied range of small business loan offerings. The average loan size is $1.2 million, and a typical loan size ranges from $500,000 to $10 million for companies with $1 million to $100 million in revenue.
Niche solutions are available for:
They offer loans for:
They offer terms up to 30 years that are fully amortizing and a typical variable prime rate of plus 2.75%.
Provider | SBA Offerings | Loan size | Terms and Fees |
First National Bank Alaska | SBA 504 | Up to $5 million | Various repayment options Fees below the market rate |
Wells Fargo Bank | SBA 7(a) SBA 504 | Up to $5 million Up to $11.5 million | Long term Fees varies |
Alaska USA Federal Credit Union | SBA 7(a) SBA 504 | Minimum $50,000 Minimum $250,000 | Long term Fees varies |
Alaska Growth Capital BIDCO, Inc. | No SBA offering Loans for: Non-qualifiers, low collateral Long-term working capital to support growth Acquisition or change of control Equipment or real estate purchase Refinancing of debt
| Average $1.2 million Range $500,000 to $10 million | Up to 30 years Prime plus 2.75% |
Local small business loan providers typically have nearby branches and understand the local conditions. This seems to make them the preferred choice, but they’re by no means always the best or only option. Small businesses should also consider online business loans that are nationally available alongside local small business loan offerings.
In this section, we look at the top online lenders and their benefits and features:
Founded in 2015, they’ve invested in over 4,000 eCommerce and Consumer SaaS (software as a service) businesses as the biggest eCommerce investor worldwide. They use predictive models that analyze your revenue, performance, and other third-party data. This is used to determine your eligibility and to generate the funding you qualify for between $10,000 and $10 million. Funds can be available in under three days.
Clearbanc is a leading provider of small business loans to women, and funds eight times more women business owners than the competition. They charge a small flat fee on the capital provided, ranging from 6% to 12%, depending on how you spend the funds and a fixed percentage of your daily sales until the capital and flat fee are repaid.
Their minimum eligibility criteria include an average monthly revenue of at least $10K for at least six months, and the business must be incorporated in North America or the United Kingdom.
Advantages:
Fundera doesn’t offer loans themselves but acts as a matchmaker between lenders, loan providers, and other financial institutions. It has been in business since 2013.
Each lender is matched with an experienced lending specialist who will familiarize themselves with your business needs and ensure that the loan solution is tailored to your business requirements. As a lender you simply need to complete one application, and the technology will match you with various products and will also determine your eligibility.
Fundera facilitates SBA loans, of which 85% can be SBA guaranteed for equipment financing and merchant cash advances. Fundera compares SBA 7(a) loans and other options for free - up to the value of $1 million. Funds are available quickly with variable fees as low as 6%.
Fundera can also be used for invoice factoring, low-interest credit cards, and loans for bad credit.
Advantages:
Founded in 2013, BlueVine offers high levels of customer service and loan access to businesses who may have a low chance of qualifying for other loans in Alaska.
BlueVine business loans are short-term business loans that span for between 6 and 12 months. A fixed interest rate from 4.8% upwards is offered, depending on factors such as the repayment period. Loan repayments are due weekly. They handle business loan reviews, loan agreements, and payments in a flexible and speedy manner. They also offer a line of credit of up to $250,000.
Advantages:
Founded in 1999, National Funding has provided funds of over $2.5 billion to more than 40,000 businesses across the USA. They offer a wide variety of loans and include loans for bad credit scoring businesses and the National Funding Edge Credit Card. Small business loans range from $5,000 to $50,000. Businesses can use them to cover the costs of anything from inventory and marketing to payroll and taxes across a wide range of sectors such as beauty and wellness, construction, commercial mortgage, retail, agriculture, restaurant industry, etc.
National funding has dedicated loan specialists to fully unpack your business needs and to provide you with guidance regarding your loan choice.
Repayments can be made either daily or weekly. National Funding also provides equipment financing and leasing up to $150,000. Merchant cash advance and credit card processing services are additional business solutions also on offer.
Advantages:
Within the state of Alaska, there are several governmental and other institutions that offer additional financial resources for small businesses. These include:
The state of Alaska also provides non-financial resources like mentoring, advice, workshops, tools, etc., to small businesses to help them grow and create measurable economic impact throughout Alaska. These include the Alaska Small Business Development Center and the Department of Commerce, Community, and Economic Development.
There are also a few key steps you need to take to ensure that you’re in the best position to qualify for Alaska small business loans. These steps include:
Business owners may require a small business loan for many reasons, including a short-term boost to cash flow, buying pricey equipment, and expanding their business. Business loans are commonly used to pursue growth and to consolidate high-interest debt to ensure the survival of the business.
All variables of a loan have to be carefully considered to ensure that you can afford to pay back the loan and to make sure that you’re getting the best deal in Alaska small business loans. Failure to repay your loan will reflect poorly on your personal and business credit score and might end up costing you your business.
Variables include terms, fees, rates, application processing times, and loan flexibility. The offerings from banks and credit unions are well established and offer great value, but don’t hesitate to consider partnering in the online lending marketplace. Their flexibility sometimes offers superior funding options and can be less risky for borrowers.
