Options for small Utah businesses seeking loans

SALT LAKE CITY — Borrowing money has become more expensive due to rising interest rates. KSL’s Tamara Vaifanua explains what that means for small business owners in Utah.

With the failures of Silicon Valley and Signature Banks, banks are pulling back on loans. Small business owners can still get financing, even with bad credit, but they’ve got to make the right moves.

Utah may be the place for business, according to WalletHub. But small business owners are feeling the pinch.

“We’re seeing higher interest rates that have really taken the bite out of the profitability of many small businesses,” said Ben Johnston with Kapitus. He helps small businesses secure loans.

He said even with a bad credit score, there are options.

First, he recommends you talk to your banker. Be open about your numbers so they can provide financial advice that’s best for your business.

If a bank turns you down, check out an online lender. Generally, the terms are going to be a bit shorter. And they may come in at a higher cost than what a bank might be able to do.

Make sure you do your homework and read reviews.

Other financing options include SBA loans, student start-up funds and grants that you don’t have to pay back.

For example, the Utah Innovation Lab is a nonprofit that invests in startups in the pre-seed phase.

“Talk to a number of different partners and see what the right fit is for you,” said Johnston.

Preparation is key.

Johnston said when you’re applying for a loan, make sure you have all the required documents.

You’ll need personal bank statements, two years of past tax returns, proof of business ownership and business plan.

For information on how to finance your business in Utah, click here.