If you are a business owner in California and you are looking for a low interest business loan to finance your business, this article will give you an in-depth analysis of the top banks that can offer you this facility. California has been categorized as one of the most entrepreneurial friendly states in the United State of America.
Many banks in the state can lend close to $11.7 billion in loans to small business owners, and entrepreneurs accounted for most of those low interest business loans by taking out 836,919 total loans for less than $100,000.
Most creditworthy borrowers were priced out of qualifying for the low interest business loan because banks began focusing their attention on larger businesses with big balance sheets. Although the credit markets and interest rates support a strong borrowing environment for small businesses, many banks are still unwilling to loosen their lending guidelines.
5 Banks we Considered best for the Low Interest Business Loan in California
Commercial Bank of California
This is one of California highest capitalized banks founded by entrepreneurial business owners and led by a talented team with an ownership mindset. Commercial Bank of California is a full-service, FDIC-insured, business bank headquartered in Irvine, California.
The company is owned, built and run by entrepreneurs for entrepreneurs. Commercial Bank of California makes and services all types of business and individual loans and lines of credit. The bank establishes a strategic outline to develop business operating/depository accounts with the Bank.
Calls on existing customers to retain business and promote additional Bank services. Provides financial counsel to current prospective customers.
Represents the Bank at various civic and community functions to further enhance its image and develop additional business. Develop a significant referral network to enhance the operation of deposit and loan relationships to the Commercial Bank of California.
Low Interest Business Loan Categories
Business Lines of Credit: Access the funds you need, when you need them. A Business Line of Credit is the perfect solution for short-term borrowing needs for which repayment is expected to occur shortly. You have the flexibility to borrow as much or as little as you need to meet your specific working capital requirements,
- With a Business Line of Credit, you incur no interest costs until funds are actually used and you can repay your borrowing at any time without any prepayment penalties.
- Business Lines of Credit can be structured on a revolving basis – repaid funds can be re-borrowed if desired – or on a nonrevolving basis.
The Business Lines of Credit can provide you access to Low Interest Business loans for a very broad variety of purposes, including the following:
- Managing cash flows for busy seasons during the year
- Taking advantage of trade discounts
- Timing your inventory purchases
- Providing short-term cash flow while you wait for collection of receivables
Business Term Loans: For longer-term borrowing needs, a Business Term Loan can be the perfect solution. Term loans are available to assist with equipment and machinery purchases, business expansion, business acquisition, permanent working capital or refinance of existing business debts.
With a variety of fixed and variable rate options, our commercial term loans can provide a valuable source of working capital for your business and help you acquire the resources you need to maximize your profitability and strengthen your competitive position.
Business Equipment Financing: If your business uses equipment in its operations, Business Equipment Financing can provide funding for the tools and equipment you need to keep your business growing. Repayment terms are flexible based on the cash flow needs of your business and the incremental revenues the equipment will generate.
Commercial Bank of California offers a variety of fixed and variable rate options to you to maintain a competitive edge by offering equipment financing to meet your business needs. Commercial Bank of California offers the following products under equipment financing.
Commercial Real Estate Loans: The bank’s experienced team will provide a custom real estate lending solution to meet your financing needs. The lending products are tailored for your needs, from short-term bridge loan financing, to “mini-perms” and long-term permanent financing.
They will work with investors, developers, individuals, brokers and other professionals to structure loans that competitively meet your real estate lending needs. Also, ask about our Government Guaranteed Loan products. Learn more
Pacific Enterprise Bank
Pacific Enterprise Bank’s lending group focuses on businesses with loan needs from $250,000 to $5,000,000. Financing is available for commercial real estate “investor and owner-occupied”, lines of credit, debt consolidation, start-ups, acquisitions, SFR flipping lines, letters of credit, diesel trucks, bridge loans, and insurance premium financing.
The Banks cash management group has more of a private banking feel and offers an array of products including remote capture, merchant card processing, online wires, ACH, positive pay and online banking.
External 3rd party programs are actively used to complement the Banks lending practices. External programs include SBA 7A Loans, SBA 504 Loans, Calcap loans, ARB Grant Program, Carl Moyer Program, and Voucher Incentive Program. The Bank is consistently one of the top SBA Bank lenders in Orange County (504 loans and 7a loans).
Pacific Enterprise Bank Low Interest Business Loan Products
Trucking and Equipment
CalCAP Truck Program
Lines of Credit
SBA 504 Loan Program
SBA 7(a) Loan Program
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Community Commerce Bank
This bank specializes in commercial real estate loans, loans to non-profit and religious organizations, apartments (5 units or more), as well as other real estate loans regardless of reason, for both consumer (commercial properties) and business purposes. Community Commerce Bank is considered to be ‘Well Capitalized’ according to all regulatory requirements and definitions.
Call one of the three branch offices for our current outstanding rates on FDIC insured deposit accounts. As a subsidiary of TELACU, Community Commerce Bank supports many social and economic development programs such as education scholarships, senior housing projects, a weatherization program, and a Veterans Upward Bound program to name a few.
Low Interest Business Loan Facilities
SBA Real Estate Loans: Low interest business loans guaranteed by the SBA are assessed a guarantee fee. This fee is based on the loan’s maturity and the dollar amount guaranteed, not the total loan amount. Generally, the guarantee fee is included in the loan.
The normal fee is 3 % of the SBA-guaranteed portion on loans of $250,000 to $700,000, and 3.5 % on loans of more than $700,000. There is also an additional fee of 0.25 % on any guaranteed portion of more than $1 million. The interest rate is adjustable based on the Wall Street Journal Prime Rate plus 2%.
Use of 7(a) Loan Proceeds: You can use the low interest business loan proceeds to help finance a large variety of business purposes. However, there are a few restrictions. For example, proceeds can’t be used to buy an asset to hold for its potential increased value or to reimburse an owner for the money they previously put into their business.
Basic uses for 7(a) loan proceeds include:
- To provide long-term working capital to use to pay operational expenses, accounts payable and/or to purchase inventory
- Short-term working capital needs, including seasonal financing, contract performance, construction financing and exporting
- To purchase equipment, machinery, furniture, fixtures, supplies or materials
- To purchase real estate, including land and buildings
- To construct a new building or renovate an existing building
- To establish a new business or assist in the acquisition, operation or expansion of an existing business
- To refinance existing business debt, under certain conditions
SBA Low Interest Business Loan cannot be used for these purposes:
- To refinance existing debt where the lender is in a position to sustain a loss and SBA would take over that loss through refinancing
- To effect a partial change of business ownership or a change that will not benefit the business
- To permit the reimbursement of funds owed to any owner, including any equity injection or injection of capital to continue the business until the SBA-backed loan is disbursed
- To repay delinquent state or federal withholding taxes or other funds that should be held in trust or escrow
- For a purpose that is not considered to be a sound business purpose as determined by SBA. Learn more
Community Commerce Bank is your neighbourhood real estate loan specialist. They’ll show you how to conveniently and economically unlock your real property’s untapped equity and use the cash where you need it. We are a lender for Owner and Non-Owner occupied properties. The bank also lends on Non-Conforming zoned properties. Learn more
Seacoast Commerce Bank
This is a commercial bank headquartered in San Diego that focuses on the needs of small businesses throughout the Western United States. They are a full-service institution, chartered and operating as a State Chartered financial institution, governed by the California Department of Business Oversight, and insured by the Federal Deposit Insurance Corporation (FDIC).
The mission is simple; provide clients with exemplary service, and the products and services they need to grow their business faster and easier. Seacoast Commerce Bank achieve this by developing long-lasting relationships with our clients through professional expertise, customized banking solutions, responsiveness, local decision-making, and access to executive management.
Seacoast Commerce Bank provides a full range of superior products and services for business, from loans and lines of credit to SBA financing, to a complete set of cash management services including Remote Deposit Capture (RDC), online banking, and all the tools you expect from a major financial institution.
Seacoast Commerce Bank Low Interest Business Loans Advantages & Benefits
The bank has the Small Business Administration (SBA) Program to help your business grow. We have a team of seasoned SBA professionals that can assist you in obtaining financing. The speciality is providing financing for a small business that is looking to purchase, construct, improve or refinance a building for their business.
Buying a building provides many advantages as shown below:
- Provides stability in your business by stabilizing rent expense
- Provides tax advantages for the business owner
- Allows for appreciation and possible retirement vehicle for the business owner.
The bank’s team has the expertise and over 150 years of collective experience to guide you through the SBA process quickly without the “red tape” or “hassle”. They are a Preferred Lender with the SBA.
This means they have delegated credit authority and can make a decision on the loan request quickly. The SBA Program provides many advantages; however, you must select the right lender to avoid pitfalls and obstacles. Seacoast Commerce Bank is the right lender and we look forward to working with you.
Benefits of Seacoast Commerce Bank SBA Loan:
- Up to 90% loan to value on multi or limited use properties
- Up to 83% loan to value on special purpose properties (includes flagged motels/hotels, national or regionally branded gas stations/c-stores, and car washes)
- Small business to occupy as little as 51% of the building
- Financing of $100,000 to $5,000,000
- 25-year fully amortized term
- Competitive rates
- Financing for the purchase, improvement, refinance and construction of the commercial real estate
- All types of properties (no retirement facilities) Loan fundings in as little as 30 days. Learn more
Tri Counties bank
The Bank provides an extensive and competitive breadth of consumer, small business and commercial banking services easily accessed through its California communities branch network, advanced online and mobile banking, a nationwide network of over 32,000 ATMs, and bankers available by phone 7 days per week.
Tri Counties Bank is a wholly-owned subsidiary of TriCo Bancshares (NASDAQ: TCBK) headquartered in Chico, California, providing a unique brand of customer Service with Solutions available in traditional stand-alone and in-store bank branches in communities throughout Northern and Central California.
The Low Interest Business Loan and Credit by Tri Counties Bank
Small Business Loans: The Bank puts you and your business first. A dedicated Relationship Manager and a team of business services professionals will work with you to find the lending solution that improves your business finances and enhances your business strategy.
Their representatives offer financial wisdom, locally-based know-how and long-term relationships that can help your business thrive. Personalized attention combined with innovative products is the basis for Service with Solutions.
A key component of Tri Counties Bank’s full-service relationship banking philosophy is to tailor appropriate lending solutions to your business needs. Their small business banking team assists you with lending solutions that keep your business growing, all with the service, support and local knowledge you expect. Read more
Commercial Loans: Tri Counties Bank, lending support tailored to your specific needs is an essential element of our full-service relationship banking philosophy.
They provide a wide variety of loans to meet both short-term working capital needs and permanent financing requirements of large enterprises. Your Tri Counties Bank Relationship Manager will structure a custom package specifically tailored to meet your current and future business needs.
The Low Interest Business Loan and Commercial Lending Programs:
- Lines of Credit: purchase inventory, make seasonal purchases or take advantage of trade discounts
- Intermediate and Working Capital: support your company’s growth
- Long-Term Loans: expand operations or restructure existing debt
- Equipment Loans: finance the acquisition of new or used business equipment
- Commercial Real Estate: purchase, renovate or refinance a commercial property, including office, industrial, retail, special purpose and multi-family residential properties
- USDA Loans: Lending programs for farmers and rural communities. Read more
Agriculture Loans: Tri Counties Bank has a long, rich history of financing agricultural operations throughout California. Tri Counties Bank can help you grow and thrive by assisting with loans for crop production, capital improvements, acquisition or expansion, refinancing, herd and feed financing equipment financing and more.
Find out more about the Low Interest Business agriculture lending options:
- Small Farm Programs
- Crops and Livestock
- Agricultural Land
- Agricultural Equipment
- USDA Programs. Read more
Government-Backed Loans: Tri Counties Bank offers lending solutions that keep your business growing, all with the service, support and local expertise you expect.
They offer a breadth of low interest business loan options backed by programs of the Small Business Administration (SBA), the U.S. Department of Agriculture (USDA) and the Bureau of Indian Affairs (BIA). In all cases, these low interest business loans are funded and serviced by Tri Counties Bank. However, a portion of the loan amount is backed by a guarantee from a government agency.
Benefits of Government Guaranteed Loans
- Lower down payment to preserve working capital
- Variable and fixed-rate payment options to suit your needs
- Higher loan-to-value guidelines compared to conventional requirements
- Shorter prepayment penalties provide flexibility in the future
- Long-term fully amortized repayment plans with no calls or balloon payments
- Multiple uses of proceeds all combined into one loan for convenience
- Longer amortization terms compared to conventional loans resulting in lower payments
- Ability to finance special purpose properties at higher advance rates. Read more
As a business owner with good personal credit and strong financials, it’s easier to qualify for low interest business loan, meaning you can borrow money at a lower annual percentage rate. APR is an accurate measure of the cost of financing. It includes the interest rate as well as all the fees you’ll pay over the life of the low interest business loan.
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