Small Business Loans in North Carolina: How To Get Funding

Thinking of starting a business in North Carolina? You’re in good company. The state is a haven for small business owners and startups. CNBC and Business Facilities magazine ranked North Carolina as the No. 1 state to do business in the country.

With that encouraging news, keep reading to discover how to fund your North Carolina small business.

5 Steps To Secure a North Carolina Business Loan

Taking out a business loan is an important decision that could affect your company’s future positively or adversely. That’s why you need to be organized throughout the process.

Below are helpful tips to get the funding you need, whether in Raleigh, Asheville, or somewhere between.

1. Determine Your Eligibility and Loan Amount

You need capital to run and grow your company as a small business owner. However, when it comes to borrowing, your qualifications impact the type of loan you can get and how much you can borrow.

Eligibility requirements vary for every loan and lender. But most start with your credit score, time in business, and annual revenue. It’s also critical to understand why you’re borrowing. So, calculate how much you need for your business needs and goals.

For example, if you’re taking out a loan to fund a new location, get estimated numbers as close to the real cost. Talk to contractors, and calculate the cost of materials and other expenses. But don’t agree to a loan amount just because you can borrow as much.

2. Have the Right Documentation

Nowadays, many loan applications are done online or through the phone. Lenders can assess your credibility by looking at your documents. So, make sure you have the following necessary documentation ready:

  • Personal identification documents (e.g., driver’s license, passport, employer identification number, or Social Security number)
  • Business identification documents (e.g., business licenses, business permits, Articles of Organization, or Articles of Incorporation)
  • Personal tax returns
  • Business tax returns
  • Business financial statements (e.g., balance sheets, cash flow statements, income statements)
  • Proof of collateral (e.g., real estate certificates and titles)

3. Put Together a Business Plan

The loan application process is your chance to convince lenders of your creditworthiness. This is why a business plan is a good supplementary document. It shows lenders you know your company from top to bottom.

In the first part of the business plan, discuss your mission, products or services, and the team. Then, mention where you want to take your business. What are your long-term and short-term financial goals? Give as many details as you can. You can also include any market research and income projections you’ve done to show how you make money.

You’ll want to include how you plan to use the funding and how you intend to repay your loan. If you haven’t done one, you can find business plan templates on

4. Research Lenders and Pick the Right One

As you venture into the business lending industry, you’ll find two main types of lenders. Traditional lenders refer to banks, credit unions, and cooperatives. Then, there are alternative lenders or online lenders.

Compare interest rates, fees, types of loans, and repayment terms each lender offers. Traditional lenders usually offer lower interest rates, but you’ll have to meet more stringent requirements. For instance, you must have been in the business for two years to qualify for bank loans. With most online lenders, you’ll only need six months.

Entrepreneurs with above-average credit scores and a strong cash flow won’t have any problem getting funding from traditional lenders. But for new businesses or entrepreneurs with poor credit, it can be difficult to meet those criteria. Fortunately, you have other loan options.

Apply with Clarify Capital today, and you won’t have to do any research! You’ll be partnered with a Clarify adviser who will walk you through the process. You’ll also get personalized advice to help you choose the best loan option based on your business needs.

5. Submit Application and Wait for Approval

Apply with Clarify, and you get our expertise. We have streamlined our application process so you can get the funding you need as soon as possible. The application form takes two minutes to fill out!

No need for multiple follow-ups. Once you receive confirmation of approval, you can expect money in your checking account in one to two days.

Small Business Loan Options in North Carolina

The number of business loans available in the market can be overwhelming. But each type of loan offers benefits that could be the right financing solution for your company. These are some of the small business loan options we offer at Clarify Capital.

Business Line of Credit

A business line of credit might be the right loan if you want revolving credit similar to a credit card. It’s a flexible funding option for borrowers who may not need cash immediately but want peace of mind knowing they can cover cash flow gaps as they arise.

With a credit line, business owners can access the capital they can borrow from, repay, and draw as needed. Furthermore, lines of credit typically don’t require collateral, so it’s easier to qualify.

Working Capital Loan

Consider a working capital loan if you’re looking for a quick loan to cover operating expenses. These loans are used for day-to-day business expenses, such as inventory, payroll, and rent. Common working capital loans include merchant cash advances (MCA), invoice factoring, business line of credit, and short-term loans.

Short-Term Loan

A short-term loan provides quick and easy financing for business owners. Some term loans are secured, but most are unsecured and don’t require collateral.

In a short-term loan agreement, borrowers receive the loan amount upfront. They repay the loan plus interest through fixed monthly payments over the term. Repayment periods usually fall anywhere from six months to two years.

SBA Loan

The U.S. Small Business Administration (SBA) is a government agency that assists small business owners through grants, free counseling, and business financing. Approved lenders, such as banks, credit unions, and nonprofits, administer the loan programs. SBA loans exist for different business expenses, such as buying equipment, purchasing commercial real estate, or working capital loans.

SBA loans typically have longer repayment terms and the lowest interest rates in the industry because the agency backs them. If a borrower defaults on a loan, the SBA pays the lender up to 85% of the balance.

Invoice Factoring

Invoice factoring lets you borrow money by using accounts receivables as collateral. Invoice financing is best for entrepreneurs who sell on credit and offer long payment terms.

In this type of loan, lenders pay you a percentage of your total invoice value upfront. Then, you turn over your unpaid invoices to the factoring company. As the invoices come due, the lender collects from your customers on your behalf. They take their fee and pay you any remaining amount.

North Carolina Small Business Loan FAQ

Below is additional information to help you get small business loans in North Carolina.

Can I Get a Business Loan With No Collateral?

Yes, you can get a business loan without putting up collateral. SBA loans, online lenders, and even some banks offer unsecured loans.

The loans mentioned above — such as working capital loans, lines of credit, invoice factoring, and short-term loans — are some unsecured loans we offer. Explore your options for no-collateral business loans through Clarify today.

How Much Income Do I Need To Get an NC Business Loan?

In our experience, borrowers who generate at least $10,000 per month get approved for loans. Lenders also use your income to calculate your loan amount. So, you must show a solid cash flow if you want to borrow more significant amounts.

What Type of Credit Score Do I Need To Get a Business Loan

The minimum credit score you need to get a business loan depends on the type of loan and lender you’re applying with. Bank loans typically require good to excellent credit scores.

With Clarify, you can get approved for a business loan with a credit score of 550. We also strive to help business owners with all types of credit. Some business owners can get a loan with a credit rating as low as 450.

Experience NC Business Success With Help From Clarify Capital

As an entrepreneur looking to grow your company, you need ways to finance your venture. Whether you need capital to add a new location, cover day-to-day business expenses, or refinance existing debt, let Clarify Capital help you get the funding you need to achieve your goals.

Fill out the online application today!

Ready To Grow Your Business?

Get approved today and have money in your account within as little as 24 hours. No obligation -- prequalify without affecting your credit!