Single Mother - My Choice

 
 

Your One-Stop Guide to Business and Government Loans for Single Moms


If you are a single mother and you run a small business, then you know getting the working capital you need is extremely difficult. If you are a single mom and you want to start a business, you are probably already painfully aware that obtaining start-up money can be even harder.

Luckily, there is a variety of options for business and government loans for single moms that will help you secure the funds you need to start or expand your business immediately.

Government Loans for Single Mothers

Government Loans for Single MothersThe Small Business Administration (SBA) delivers millions of SBA loans, loan guarantees, certain contracts, business counseling sessions and various other forms of assistance to small businesses. The agency is a great place to find out about loans and grants for single mothers. The SBA furnishes small businesses with a variety of financing that ranges from micro lending (very small, short-term loans) for existing businesses to substantial venture capital loans to start a new business. The SBA also offers Entrepreneurial Development, which consists of education, information, training, and technical assistance for existing and future business owners.

The SBA also offers free, individualized face-to-face and internet-based counseling for small business owners, as well as training to grow your business at an extremely affordable rate. The SBA has many special loan programs for disadvantaged populations, and government loans for single mothers are easy to qualify for under the umbrella of some of these programs.

  • Microloan Program - SBA LoanThe Microloan Program This SBA program awards small short-term loans to disadvantaged small business owners such as single mothers. It also awards funding for certain types of not-for-profit child-care centers. The way the SBA makes the money available is by using pre-selected intermediary lenders – nonprofit community-based organizations that have lending experience. The lending intermediaries make loans to business owners that are eligible for the program. The maximum microloan amount you may be awarded is $50,000, and the average microloan amount awarded is roughly $13,000.
  • 7(a) Loan Program - SBA Loan7(a) Loan Program The 7(a) loan program is an SBA-backed loan that the agency provides through SBA-certified commercial lenders. The maximum loan amount that you can qualify for when awarded a 7(a) loan is $2 million, and the SBA will guarantee up to 75% of that amount. You (the borrower) and the lending institution agree upon your interest rate. However, the SBA has pre-set maximum interest rates depending on the amount of your loan, and the highest rate is currently set at 4.75 percent for a loan of $25,000 or less with a maturity date of seven years or more. The 7(a) loan program is extremely flexible, so it's a great starting point for single mothers looking to fund a new business. The program is ideally suited for both start-ups and smaller growing businesses when other sources turn the business owners down. You can use the money for a range of purposes, including business renovation, marketing materials, and equipment.

Business Loans for Single Mothers

Business Loans for Single MothersIf you tried various channels for business and government loans for single moms such as the SBA only to be turned down, don't lose hope. You can still qualify for a small business loan through nontraditional channels. Peer-to-Peer (P2P) lending has become quite popular in the online world. The financial transaction (e.g. lending or borrowing) happens directly between individuals. The whole loan process happens between people without the inter-mediation of a traditional financial institution. This option is great for single moms who want more funding for existing businesses or venture capital for a start-up because qualifying for a P2P loan is based on your whole situation, not just your credit score. Some well-known P2P lending sites are:

  • Prosper
  • Lending Club
  • WikiLoan
  • GoBigNetwork
  • FundaShare