Wells Fargo Small Business Loans

When it is time to expand the business, most small businesses struggle as they lack the funds. Most banks are also reluctant to lend loans to small businesses, especially those who’ve been active for less than two years. However, Wells Fargo might have the answer to all the problems faced by small businesses and startups.

Wells Fargo offers a US SBA loan (Small Business Administration):

Longer Repayment Terms: Monthly payments will be low

Lower Down Payments: Upfront costs are much more affordable

Types of SBA Loans Offered by Wells Fargo

1. SBA (7A)

2. SBA 504

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Types of Loans offered by Wells Fargo Loans

1. Line of Credit

Purpose

Key Features

Advantages

2. Line of Credit

Purpose

Key Features

Advantages

3. Wells Fargo Small Business Loan

Purpose

4. Equipment Express Loan

Purpose

Lending Criteria for Wells Fargo

1. Credit History

Credit history is an important factor that banks consider before they offer businesses any loan. Therefore, the lenders will analyze your credit history, the open and close accounts, and the repayment history of the past decade. Lenders will also ask government agencies for credit history data.

Why is Credit History Important?

Good credit history, better known as credit score, shows that the business has been paying off its monthly debts before the due date. The business's credit score will also impact the interest rates offered, the amount of loan, and the term. A good credit score means you will get a higher amount of loan at a cheaper interest rate.

Why Does Your Credit Score Mean?

The credit score of a business is an overview of how well they've managed their credit. A three-digit score also referred to as a FICO score, should typically fall in the 350 to 800 range. However, credit agencies have different scores, so the score your business gets might differ.

Wells Fargo Credit Score Standard

2. Capacity

The capacity of the business is taken into account because it shows to the lender that you are capable of paying your dues and expenses on a new credit account. In addition, lenders will generally review your monthly income and financial obligations.

Why is Capacity Important?

Lenders analyze the debt-to-income ratio when they are trying to determine if the business is eligible for credit or not. Therefore, a low debt-to-income ratio or DIT is a good indicator and proves to the lenders that your business can pay the loan.

Wells Fargo Standard for Debt-to-Income Ratio

3. Collateral

Collateral is an asset that is owned by the company, such as inventory and equipment. Collateral is an important factor for lenders because it will offset their risk by lending the loan to the business. Using collateral as an asset gives the business more borrowing opportunities and access to credit accounts with lower interest rates.

4. Capital

Lenders will usually evaluate the capital the business has before approving the loan. Capital is usually an asset that can be used to pay a loan. Retirement accounts, down payments, and investments are generally considered capital. The more capital a business has, the more financially secure it is.

5. Conditions

Conditions are a variety of factors that the lenders consider:

Wells Fargo Interests, Fees, and Loan Options

1. Wells Fargo Prime Line of Credits

Fees: An origination fee of 0.50 % is competitive and needs to be paid once the account is opened and yearly.

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Interest Rates: +1.75% Primal

2. Wells Fargo Business Line of Credits

Fees: $ 95 fees for a line of credit of 10,000 to 25000 dollars. $ 175 for line of credit of 25,001 to 100,000

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Interest Rates: +1.75% Primal

3. Wells Fargo Small Business Loan

Fees: Opening fee of $0 for a Credit account

Interest Rates: Fixed-rate starting at 6.25 %

4. Wells Fargo Equipment Express Loan

Fees: Opening fee of $0 for a Credit account

Interest Rates: Fixed-rate starting at 4.5 %

Wells Fargo Application

Wells Fargo Prime and Business Line of Credit

You can apply for this loan online or in person, and this is what you will need to provide:

At least one owner of the business should provide the following information:

The owner of 25 % or more of the business should provide the following information:

Information required for Prime Line of Credit:

Wells Fargo Small Business Loan

Wells Fargo Equipment Express Loan

For more information, please log on to the website of Well Fargo.

Summary of Wells Fargo Loan Options

We have identified four types of business loans that Wells Fargo offers:

Each loan comes with its qualification criteria, and you need to fulfill certain obligations to be granted the loan. However, if you fit the criteria set for the loans, Wells Fargo is the place for you, as the loans are available at competitive and lower rates, and the fee is also reasonable.

For more information regarding loads, learn more.