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Colorado Small Business Loans

Colorado is among the fastest-growing states in the nation. Apart from its increasing population, the state's economy is also flourishing. In Colorado, it's not just large businesses that help the economy prosper; small businesses also play an essential role. If you own a small business, you might need to consider applying for a loan.

At a glance If you’re looking for the best loan option in Colorado, you’re not alone. With a total number of 563,917 small businesses in Colorado, it's one of the best states for business loans. You can request business loans from local government and state agencies, private lenders, nonprofit lenders, and more in Colorado. 

A Quick Overview of the Best Small Business Loan Options in Colorado

If you own a small business and you’re looking for the best local funding option in Colorado, several options are available for your consideration. Each loan option has its benefits and downsides. So it’s best if you weigh up all your options and then decide which loan best fits your business needs. 

Here are some of the best local funding options to consider during your journey to search for small business funding for your Colorado business. 

Financial Institution

Amount of Loan

Interest Rate 

Requirement

Colorado Business Loan Fund

Loan amount of up to $200,000

interest rates of 8.25% to 9.25%

  • You need to create one job for every $20,000 in funds received
  • 51% of the jobs created should be filled by low- to moderate-income persons

Colorado Enterprise Fund

A maximum loan of up to $1 million

Fixed rate 

  • Minimum of one full-time employee or sole proprietorship

  • Less than $2.5 million in annual revenue

Colorado Lending Source

A loan from $25,000 to $5 million (depending on the type of loan you’re applying for)

From 9.75% to 12.75%

  • Business should be located within Colorado
  • The business should be for-profit
  • Other requirements depend on the type of loan you’re applying for.

Bank of Colorado

Maximum loan size of $350,000

Competitive interest rate 

  • Collateral is required
  • The credit score requirement depends on the type of loan you’re applying for. For instance, a construction loan requires a credit score of at least 630

Community Banks of Colorado

Maximum loan size of $500,000

1.00% fixed

  • Two months borrower deposit statement
  • Three years of tax returns, including all schedules and K-1s

The Best Small Business Loan Options in Colorado Expalined

1. Colorado Business Loan Fund

The Colorado office of the Economic Development and International Trade (OEDIT) manages the Colorado Business Loan Fund. OEDIT manages 14 different loans that help small business owners across the state. 

As a business owner, you can request one or several of these loans to kick-start your startup or improve an existing business. To get approved for a financial loan, you need to satisfy a job creation requirement. First, you need to create a job for every $20,000 that you request in loan funds. It means that if you request $100,000 in loan funds, you need to have created five jobs. 

Additionally, over 50% of the jobs created should be filled by people with low-to-moderate income. The loan application will require you to submit a financial projection and business plan. If you have an existing startup, you’ll need to submit your financial statement history.

In most cases, small business owners applying for the funds usually seek more than $100,000. But, if you apply for an amount less than that and you have five or fewer workers, you can qualify for a Micro-Enterprise Loan.

2. Colorado Enterprise Fund

Colorado Enterprise Fund is a nonprofit organization that has been in existence since 1976. The nonprofit lender specializes in helping people finance their ideas. Since its inception, the nonprofit organization has issued more than 2,000 loans to small businesses.

Besides providing you with loans, the organization will also support your business by offering mentorship, online tools, and business coaching to help you achieve your goals. 

Colorado Enterprise Fund also offers other specialized loans, such as the Healthy Foods Fund program, which offers up to $250,000. The funding program is for startups such as agriculture businesses, food trucks, grocery stores, and other food-related ventures. 

Additionally, the institution also offers valor loans for veterans. The loan funding offers up to $500,000, and it comes with a 10-year term. Colorado Enterprise Fund also provides SBA community advantage loans, which give up to $250,000 with a 25-year term. 

Other financing options available through this institution include:

  1. Step-up loans: Offer up to $500,000 with a 10-year term.
  2. Just in time lines of credits: Offer up to $100,000 with a 2-year term.
  3. Commercial real estate loans: Offer up to $500,000 with a 7-year term.
  4. Dream Big microloans: Offer up to $50,000 with a 7-year term.
  5. Gap loans: Offer up to $500,000 with a 25-year term.

When applying for funds, the organization will consider some factors, to determine whether to approve your loan application or not. These include:

  1. Personal credit score
  2. Industry experience
  3. Equity
  4. Payment history
  5. Collateral
  6. Cash flow and profitability

3. Colorado Lending Source

Colorado Lending Source is another nonprofit organization that has been providing financing to small businesses since 1990. In 2018, the nonprofit lender provided more than 221 loan fundings to businesses in Colorado. The lending institution is well known for its SBA loans.

SBA loans are government loans that offer a long-duration payment plan with low interest for lenders. Some examples of these SBA loans include general small business loans, microloans, commercial real estate loans, and community advantage loans.

Microloans are also called Colorado Main Street loans. It's a character-based microloan that helps you start or expand your business. The program offers up to $50,000, and it’s available to startups that can't afford a conventional loan.

Community advantage loans are primarily for underserved communities. If you own a small business in a community with a low income, then you might qualify for this loan. To apply for this loan, you need to state the amount you need and what you want to finance. After that, you will need to submit your business plan and other required documents.

4. Bank of Colorado

Bank of Colorado has been supporting small businesses with local fundings for more than 100 years. The Bank has all the experience required to help you find the kind of loan you need. The Bank has branches throughout the state, including Denver, Akron, Fort Collins, and Colorado Springs.

Similar to other banks, all loan applications through the Bank of Colorado will require collateral. Fortunately, the collateral isn’t limited to real estate. You can use other assets as collateral, including equipment, inventory, and account receivables. If you have an agribusiness that requires funding, the Bank of Colorado is a great option to consider. 

The Bank has more than 100 years of experience working with agribusiness. And they have special financing programs for it, such as the agric loans and line of credits, and livestock loans. Bank of Colorado offers other financial funding options for small businesses. These include business loans, lines of credit, equipment loans, and more. 

5. Community Banks of Colorado

Community Banks of Colorado is a subdivision of NBH Bank. It’s an FDIC-insured bank that serves clients throughout Colorado. The Community Banks of Colorado has an extensive portfolio of products and services to satisfy small businesses, consumers, and commercial clients.

Besides being a nonprofit organization, small businesses can choose from a wide range of financing products. For instance, you might see that a term loan is best for significant investments, such as expanding your farm mortgage or constructing new buildings. But, if you’re looking for an emergency business loan, the business line of credit is a great option to consider. 

Additionally, Colorado's Community Banks also provide loan fundings for community associations, farms, and healthcare ventures.

Top Online Colorado Small Business Loans Options

Since the inception of the internet, most businesses are now being conducted online. You might have used the internet for businesses, from interacting with your customers via email or paying your electricity bills. 

Why not use the internet to source funds for your small business?

Online lenders make it easy for you to apply for loans. You can fill out your application, submit the required documents, and even receive the funds, right from the comfort of your home. 

Impressively, you can receive your funding within 24 hours when you apply online for a loan. There are several online lenders available for you. Below are the top four online lenders that you should consider.  

1. Fundera

Fundera is the go-to online lender for every small business. It’s an all-in-one lending platform that focuses on systems that you need to manage your businesses' expenses and income. Since Fundera's inception, it has helped over 85,000 small businesses and has over $2.5 million in loans.

The online lender partners with more than 20 online lenders to help find various fundings for small businesses. The standard type of loans available via Fundera includes equipment acquisitions, startup, working capital, business line of credit, SBA loan, and more. 

Some of the benefits of using Fundera include:

  • No hidden charge
  • A fast and straightforward application process
  • Helpful resources and guides

To qualify for Fundera's loan application, you need to have:

  • A personal credit score of 550 or higher
  • A business of three years
  • At least $300,000 annual revenue

2. Fundbox

If you want a flexible and quick line of credit, Fundbox is an excellent option to consider. When you apply with Fundbox, you can access up to a $100,000 line of credit.

Fundbox charges a token of 4.66% of the initial funding, and this depends on the performance of your business. 

Repayment of loans is made over 12 to 24 months, and it’ll be deducted automatically from your account every week. Fundbox has a swift and convenient application process with minimum borrower requirements. 

Some benefits of using Fundbox include:

  • Fast application process
  • No specific credit score requirement
  • You can re-apply for new credit once the initial credit is approved 

To qualify for Fundbox's loan application, you need to have:

  • A minimum of $50,000 yearly revenue
  • Business checking account
  • Three-month active bank statement of account

2. OnDeck

At OnDeck, two different loan options are available for small business owners in Colorado. These include a line of credit and term loans.

With a term loan, small businesses can access funding of up to $500,000. You can access short-term loans with a three- to 12-month repayment period and a minimum interest rate of 9%. Meaning that the interest is a percentage of your loan.

For example, if you apply for a $50,000 loan with a 9% interest rate, it means you'll need to pay $4,500 in interest. Or you pay a total of $54,500 before any additional charge is applied.

OnDeck also offers a long-term loan with a 15 to 36-month payment plan and a minimum interest rate of 9.99%. However, if you require a more flexible loan option, you can apply for a line of credit. It offers up to $100,000 with annual percentage rates (APR) of 13.99%.

Additional Colorado Small Business Financial Resources

Besides loans from online lenders and commercial loan programs, small businesses in Colorado can also access business grants. Unlike a loan that requires a payback, grants are like free funding - you don't have to pay them back. 

While small business grants can be highly competitive, it's worth trying out if you meet the requirement. Here are grants open to Colorado small businesses:

Advanced Industries Early-Stage Capital and Retention Grant

If you have an early-stage startup business with a product with a market in Colorado and the world, this grant is the best option to consider. To qualify, your startup must be under one of these categories:

  • Electronics
  • Bioscience
  • Energy
  • Aerospace
  • Manufacturing
  • Information and technology
  • Infrastructure engineering

You can access up to $250,000 if you meet the requirements. 

Collaborative Infrastructure Grant

The Collaborative Infrastructure Grant focuses on companies that support the state's advanced industries. These companies include supply chain management, manufacturing, technology, and research and development. 

Companies that meet the grant requirement can secure up to $500,000 with at least a $50,000 grant.

How to Prepare for Colorado Small Business Loans

Once you discover which Colorado small business loans you want to consider, you can focus on putting your best into the application process. Though lenders have different criteria for evaluation, there are some things you can consider to help increase your chances of qualifying. 

  • Develop a good business plan
  • Attain a good credit score
  • Maximize your business revenue

The Bottom Line

Starting a Colorado small business isn’t easy, but there are several loans that you can use to achieve your business goals. Whether you’re just starting your business or you want to expand an existing one, several local and nonprofit business loans are available for you. However, if you don't qualify for these options, remember that several small online business funding sources are also available.