Find the Best Small Business Loans in Baltimore, MD

How to get a business loan in Baltimore

Baltimore is ripe for small business development and startup companies, yet the number of new businesses here isn’t on par with business development in similarly sized and situated cities elsewhere in the country. A study by the 21st Century Cities Initiative at Johns Hopkins University shows that Baltimore has fewer business lenders than many other cities of similar size, which has slowed development.

With Baltimore’s lending infrastructure in need of improvement, many companies are looking to investors outside of the city to find the necessary capital to begin or expand a small business, according to the study. While this makes it more difficult to find small business loans, funding is still available for companies that know where to look.

Types of business loans in Baltimore

There are multiple types of business loans available for Baltimore businesses, and knowing which one fits your needs increases the likelihood you’ll be approved. Choosing the right loan for your company’s situation can also help you ease the burden of repayment.

Loan type	Recommend for	Quick facts
Term loan	Growing an established business	Repayment over fixed period; collateral usually required
SBA loans	Established small businesses	Long wait times; extensive qualifications; low rates; longer terms
Microloans	Startups and businesses in disadvantaged areas	Smaller amount; extensive requirements; low cost
Equipment loans	Equipment purchases	Competitive rates; often requires down payment; equipment used as collateral
Business line of credit	Short-term business needs and unexpected expenses	No collateral required; higher fees and rates
Invoice financing	Businesses with unpaid invoices	High rates and fees; unpaid invoices serve as collateral
Merchant cash advances	Businesses with high volume of credit card sales	Fast cash; extremely high rates; rapid repayment
Purchase order loans	Small businesses without capital to meet large orders	Lender takes control over process and remits payment, minus their fees, to business owner
Rollover for business startups (ROBS)	Young entrepreneurs with extensive retirement savings	Risks retirement savings; no fees

Finding business lenders in Baltimore

While going through traditional lenders such as banks is still an option, many Baltimore small business owners are turning to nontraditional online lenders, non-profit organizations or government programs to find capital.

Online lenders offer convenience, easy application processes, few requirements, multiple loan types, speedy approval and quick access to money. While some online lenders require good credit scores, others may choose to focus on your business plan and viability when deciding whether your company qualifies for a loan.

The city and state offer several programs for small businesses. The Maryland Department of Commerce provides access to more than a dozen general business, industry-specific and location-based loans, and Baltimore offers community catalyst grants for neighborhood-based organizations and community development corporations as well as other redevelopment initiatives.

There are also a growing number of nonprofit lending options in the area, such as programs from the Maryland Small Business Development Financing Authority, Baltimore Development Corporation and Baltimore Business Lending.

Fees and requirements for business loans in Baltimore

Depending on the type of loan you qualify for, your lender may require collateral. The amount of collateral varies between lenders, but it’s not uncommon for collateral requirements to be equal to the amount of the loan.

Be prepared for application fees and have the following information ready before you apply:

• Your credit score
• Desired loan amount
• Value of the assets you're willing to use as collateral
• Proof of assets, income and revenue

Be sure to read all the eligibility requirements before applying for a loan. If your loan application is denied, it’s possible your credit score could be damaged. Lenders may also charge fees for the loan, so be sure you understand all fees and compare the total costs of loans before committing.

For more information on lending in Baltimore, check out this report by the National Community Reinvestment Coalition.