Our goal at Lending Valley is to provide all small business owners access to the best loans possible for their business. You can rest assured we will get you the best rates in the market!
Hawaii is the only state in the United States located outside North America. The “Big Island” is diverse in nature because of its unique location and has a low population. The state is largely dependent on imports which is the reason for its high cost of living and low personal income. However, Hawaii’s agricultural sector is the major component of the local economy. The labour market has been positive for some time now. According to financial analysts, Hawaii is one of the best places for small businesses. The state has about 126,000 small business which makes up about 99.3 percent of all Hawaii businesses. Thus, it is very important for the state’s economy to keep the small businesses alive. Hawaii business loans play a crucial role in this.
How can I get a small business loan in Hawaii?
Different financial lenders in Hawaii will make it easier to run or start a business. With multiple options, it is up to the companies. It is very important to figure out the reason for which financial assistance is required.
Conventional Bank loans are the first choice for Hawaii businesses as they offer the best rates. Moreover, lenders will look for business owners with collateral, high sales volume, and good credit. They are mostly utilized by Georgia small businesses to take hold of other businesses, purchase commercial real estate, refinance a business mortgage, help with expansion financing of other businesses, and offer small businesses working capital. Loans of this type have 1 to 5 years repayment options.
Small Business Administration’s (SBA) lending program is also a great option as it is backed by the government. This means, when a Hawaii small business defaults, an SBA loan reduces the lender’s exposure to losses as the government helps to compensate for most of their losses. This is why SBA lenders provide this service especially for small businesses as it minimises the risk. However, being controlled by the government, the process requires a lot of paper work. The government collaborates with banks, community workers, and micro-lending institutions to provide loans to companies. SBA loans are ideal for Hawaii small businesses.
When a small business does not have enough fund for a conventional bank loan, it looks for alternative financing options. Alternative business loans offer better rates and enough terms for working capital objectives and require much less paper work than any conventional bank loans. Thus, the process is much faster than any regular bank loans, and funding can be completed within a week. However, the interest rates are a bit higher than conventional bank loans and SBA’s.
Asset based loans (ABL) assures the Hawaii businesses to monetize their assets on the company’s balance sheet. Assets such as buildings, land and other commercial property, along with account receivable, inventory and equipment and machinery can be legalized and utilized for an asset-based loan.
Challenges faced by small businesses in Hawaii
Businesses in Hawaii faces many challenges during their venture. The state is majorly dependent on imports which affects the local economy. Surprisingly, Hawaii residents pay the most per person in state taxes in the whole country. The state’s tax burden is considered too high which contributes to an unpleasant business climate. Moreover, the living costs are inflated despite being lower than New York and San Francisco. The costs of transportation of goods also adds to the challenge because of the state being isolated from others. Poverty rates are also relatively higher in the state.
Unsecured business loans in Hawaii
Business lines of credit is a kind of small business loan that offers flexibility which usual loans does not offer. This type of loan is best to compensate for expenses that tend to fluctuate throughout the course of the year. Line of credit is offered by banks in Hawaii.
New or used business equipment can also be financed in many ways through equipment financing. While some Hawaii small businesses will find it easiest and most affordable to obtain a term loan or other type of lending facility to purchase business equipment, other small business owners may find that the best way to obtain the equipment is to lease rather than buy. This is because leasing reduces the amount of cash that would be required instead of leasing equipment. By leasing, the company won’t be forced to pay the full-price for the equipment upfront. Moreover, they will enjoy the latest equipment beforehand.
Term loan is another form of loan which is paid in instalments over a set period of time. Term loans can also be used as acquisitions, and consolidations and refinancing business debt. This type of loan offers varying rates.
Documents required to get a small business loan in Hawaii
– 1-page application
– 3 months of bank statements
Operating a company in Hawaii is a difficult task. On the other hand, due to weak competition, small businesses can thrive in the Aloha state. Hawaii small business loans will always remain vital, keeping the state of the companies steady and contributing to the struggling economy of the state.