How to Find Business Loans in Texas
Texas just might be a great place to be in business — in fact, CNBC named it “America’s Top State for Business” in 2018, making it the first state to win that honor four times in the 12 years that CNBC has published the rankings; it has also ranked consistently in the top 5 throughout the 2010s. Texas’s 2.9% growth rate in the fourth quarter of 2019 outpaced the overall U.S. growth rate of 2.1%.
Like businesses elsewhere, companies in Texas can find financing from national banks, online lenders and federal credit unions. There are also particular lenders with a strong presence in the Lone Star State, which we’ll cover in depth below.
- Where to find business loans in Texas
- Texas small business grants
- National small business loans and grants
- Resources for business owners in Texas
- How to get a business loan in Texas
Where to find business loans in Texas
If you’re looking for small business loans in Texas, here are five options you may consider, depending on where your business is located and what your needs are:
- In Austin: Horizon Bank
- In Houston: Amegy Bank
- In Dallas: Commonwealth Business Bank
- Across Texas: Texas Capital Bank
- Underserved businesses: Accion
1. Horizon Bank
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Touting itself as “born, raised and invested in Texas,” Horizon Bank promises that it “speak[s] fluent Texan.” Horizon’s locations are all in Austin, and the bank is focused on growing Texas businesses by supplying working capital, equipment loans, term loans, property loans and lease financing.
Horizon is also a preferred Small Business Administration (SBA) lender. It offers SBA 7(a) loans up to $5,000,000 for a variety of purposes, including expansion or acquisition, working capital, inventory, equipment and debt refinancing. The bank also offers SBA 504 loans in amounts up to $11,250,000 to reduce down payments and extend amortizations.
2. Amegy Bank
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Amegy Bank provides a range of financing options for business owners — and while it may have begun in Houston, which continues to be the home of their headquarters, it also serves communities in Dallas, Fort Worth and central Texas from 81 banking center locations.
Amegy offers business term loans up to $175,000, business lines of credit up to $50,000, factoring with advance rates up to 95% of invoice amount, real estate loans for up to $3,000,000 for owner-occupied properties and equipment loans up to $10,000,000 or more. Additionally, the bank offers a variety of SBA loans, including:
- 7(a) term loans
- Express term loans
- Express revolving lines of credit
- 504 loans
The bank also provides community-oriented financing (such as loans to community development groups and faith-based organizations), and specializes in marine financing, noting its proximity to the Port of Houston and others in the metro area.
3. Commonwealth Business Bank (CBB Bank)
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Founded in Los Angeles in 2005, Commonwealth Business Bank, also known as CBB Bank, grew to prominence by serving the city’s Korean American business community. It is now one of the largest Korean American banks in the U.S.
In Texas, it has branches in Dallas and Carrollton, both part of the larger Dallas-Fort Worth area that’s home to a large Korean American population. CBB Bank provides a range of business funding, including business term loans and lines of credit, professional loans (including funding for equipment purchases, office expansions and working capital) and trade finance for import/export businesses.
4. Texas Capital Bank
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Texas Capital Bank has branches in some of Texas’ largest cities — Austin, Dallas, Fort Worth, Houston and San Antonio — as well as New York City. It was named one of the Best Banks in America by Forbes magazine several times since it first appeared on the list in 2015.
Texas Capital Bank provides business term loans up to $750,000, equipment financing, asset-based lending for efforts like expansion, recapitalization and acquisitions, sponsor finance, such as leveraged buyouts, add-on acquisitions and growth capital, SBA 7(a) loans up to $5,000,000 and SBA 504 loans up to $15,000,000.
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Accion, the largest nonprofit lending network in the U.S., helps underserved borrowers get access to business credit and resources to help them succeed. The organization provides microloans of $1,000 to $25,000, small business loans of $300 to $1,000,000 and SBA Community Advantage loans of $50,000 to $250,000.
The network is made up of three certified Community Development Financial Institutions (CDFIs) located throughout the country, whose operations and lending are focused on building up and empowering communities. Accion is focused on supporting underserved borrowers: 64% of its loans go to minority-owned businesses, 42% to women-owned businesses and 60% to low- and moderate-income business owners.
Texas small business grants
Grant funding for growing a business is very difficult to find; the vast majority of this kind of funding is earmarked for populations that have a harder time accessing traditional business financing like loans. That means that many businesses are not qualified for grants due to specific eligibility requirements. Those that are eligible may find it a time-intensive task to track and apply for the grants they may be able to obtain.
State-level government grants for small business usually focus on helping improve a specific social or economic concern in the state. This funding is typically more readily available than federal funding, but most businesses will still find it a challenge to procure state grant funding.
There is no one place where business owners in Texas can go to find all state grants available to them. To explore available opportunities, Google is a good place to start.
You may also consider:
- Contacting one of the SBA’s local offices, which have counselors who can offer advice about funding opportunities
- Checking out the “accessing financing” section of the USA.gov Texas grants site to get an overview of what’s available
- Looking at the Texas.gov eGrants website, which lists competitive funding announcements from Texas State agencies
You may also find industry-specific opportunities available. For example, the Grants Office within the Trade and Business Development Division of the Texas Department of Agriculture is one place to turn for farming- and health-focused opportunities.
Some available grants include:
- Young Farmer Grant: This program provides dollar-for-dollar matching grant funds to young farmers who currently have or are planning to start an agricultural business in Texas.
- Establishing the 3E’s Nutrition Grant Program: This program funds childcare centers to help them create health and nutrition programs to prevent obesity among children in Texas. The three E’s in question are education, exercise and eating right.
National small business loans and grants
Small businesses nationwide can access loans and other types of financing from a variety of sources, including national banks, online lenders, peer-to-peer lenders and credit unions.
Online businesses loans provide a particularly wide range of opportunities for funding, as borrowers with lower credit scores can often get approval from various lenders. Credit unions are likely to have more competitive rates on lending, but eligibility may be quite restricted.
Federal government grants usually have specific restrictions about how the money can be used and how progress must be reported. You can check out opportunities for yourself at Grants.gov, where there’s a searchable database of open grants.
The SBA also offers some nationwide grant programs, including:
- America’s Seed Fund: SBIR & STTR: Two SBA programs are focused on scientific research and development (R&D)
- Program for Investment in Micro-Entrepreneurs (PRIME): Low-income entrepreneurs may find a funding opportunity in this SBA program, which offers loans and grants to underserved businesses for technical assistance and capacity building, research and development and other purposes.
Grants from private foundations and companies are likely to be less restricted, but may be defined by a narrow focus or purpose. There are a variety of private companies and foundations that offer small business grants to entrepreneurs around the country. These opportunities come and go frequently, so no one list is bound to be accurate for long.
Some that you might want to look into include:
- FedEx Small Business Grant Contest: This annual award is given to businesses that have impressive pitches, operations and growth plans.
- Fundora’s Zach Grant: This grant is given based on a short video each applicant submits to explain their business.
- Visa Everywhere Initiative: Three winners focused on solving commerce and payment challenges receive large grants, exposure and networking opportunities.
- National Association Self-Employed (NASE) Growth Grants: Members of NASE are eligible for this funding, which is designed to help their businesses grow.
- Amber Grant for Women: This organization awards a grant to a woman business owner each month, and a larger award at the end of each year.
- Cartier Women’s Initiative Awards: This international competition gives large funding awards to projects led by women entrepreneurs.
- Girlboss Foundation Grants: These grant awards are designed to benefit women entrepreneurs in creative fields.
Resources for business owners in Texas
Small business owners — whether they’re just getting started or are well established — can find assistance from the SBA and Texas Small Business Development Centers, both of which have offices around the state, as well as various other programs and organizations.
Texas SBA offices
The SBA maintains several offices in Texas, where business owners can go to get advice and guidance. There are offices in the following locations:
- Dallas/Fort Worth
- El Paso
- Lower Rio Grande Valley
- Lubbock-West Texas
- San Antonio
Texas Small Business Development Centers (SBDC)
This network consists of centers located throughout all parts of Texas. SBDCs offer free business consulting and training for every stage of business development, including writing a business plan, seeking financing and expanding into new markets.
SBDCs in Texas are run by four universities, each of which covers a region of the state:
- Texas Tech University (Northwest Texas)
- University of Texas at San Antonio (Southwest Texas Border)
- Dallas County Community College District (North Texas)
- University of Houston (Texas Gulf Coast)
Each of these regions has local offices to help people throughout the state get access. You can use the site’s office search tool to find your local SBDC.
SCORE is a nonprofit association that matches up volunteer business counselors with small business owners around the U.S. The organization provides a wealth of useful business and entrepreneurship advice and information on its website.
Women’s Business Centers (WBC)
This national network of more than 100 centers around the country is focused on helping women establish and grow small businesses. The SBA’s locator site allows you to seek out the Women’s Business Center closest to you.
U.S. Export Assistance Centers (USEAC)
USEACs are a network of trade professionals who provide counseling and other assistance to help small and midsize businesses around the U.S. export their products and services. There are multiple USEACs in Texas to help the state’s business owners learn about exporting.
Veterans Business Outreach Centers (VBOC)
VBOCs offer resources like business training, counseling and referrals to transitioning service members, veterans, National Guard and Reserve members and military spouses who want help with founding or growing a small business. You can use the SBA’s locator site to find an office near you.
Historically Underutilized Business Certification Program (HUB)
This program certifies HUB businesses as those that are at least 51% owned by an Asian Pacific American, Black American, Hispanic American, Native American, American woman or service-rendered disabled veteran. It requires all Texas state agencies to prioritize HUBs for contracting for construction services or commodity purchases.
Disadvantaged Business Enterprise Program (DBE)
The DBE program prioritizes small, minority and women-owned companies to do business with the Texas Department of Transportation (TxDOT) and other agencies that get funding from the U.S. Department of Transportation.
How to get a business loan in Texas
The process of obtaining a business loan in Texas will depend on which lender you are approaching. Most lenders will allow you to apply online, though in the case of traditional banks and credit unions, you can also apply in person at a branch.
If you are applying for a loan online, you will need to provide information about your business and yourself, including your:
- Name and contact information
- Social Security Number and/or Employer Identification Number (EIN)
- Business name and location
- Financial information for your business, such as average balance in bank accounts, total debt, monthly debt payments and revenue
The bank may contact you for more comprehensive information as it processes your application. If you’re worried that you may not be approved, consider using a cosigner to secure your loan. A cosigner is another party who agrees to be responsible for the payment of the loan, a prospect that reduces the financial institution’s risk in lending to you and makes your application more likely to be approved. You could also put up collateral to secure the loan, which could make it easier to secure a loan at a lower rate.
Once you’re approved, the bank will send you information about the proposed loan, and you can accept the terms and receive the funding. This can happen very quickly — sometimes within a day with some online lenders. The process for other sources of financing, especially SBA loans, will typically take longer.