Finimpact
Updated on

Delaware Small Business Loans

Delaware is a top state for business development, ranking #1 nationally on patents issued per capita and #8 on the US State Innovation Index, according to Bloomberg. Many small businesses have emerged in Delaware throughout history and have grown into gigantic multinational corporations, especially...

Delaware
Tetiana Sitiugina-Babiuk
Financial Sector Specialist and Content Strategist

Many or all of the products featured here are from our partners who compensate us. This may affect which companies we write about and where the company appears on a page. However, any analyses, or reviews expressed in this article are those of the author’s alone, and have not been approved or endorsed by any partner.

According to Small Business Administration statistics, there are 88,051 small businesses in Delaware, which make up 98.4% of the total number of businesses within the state. In 2019, reporting large blanks have issued $273.9 million in loans to businesses with revenues of $1 million or less, - a number that has been steadily growing since 2010.

Best Small Business Loans in Delaware

WSFS Bank

WSFS Bank is a Delaware institution, through and through, offering small business loans to businesses of various scales. The SBA program through the WSFS Bank provides approximately $10 billion in loans to small businesses each year.

Their 7(a) loans have a refinancing period of 10 to 25 years and a loan amount of up to $5 million. SBA Express loans of up to $100,000 can be approved in two days and funded within three days. These loans have to be paid back within a term period of three to 10 years.

Other types of loans provided are lines of credit of up to $500,000, term loans to purchase fixed assets, and letters of credit to credentialize purchases for small businesses. WSFS also offers loans for commercial real estate investing and will give loans for commercial mortgages paid back within 25 years.

Dover Federal Credit Union

Dover Federal Credit Union was started by a few air-force veterans with the intention of helping people develop their dreams. The Dover Federal Credit Union offers a wide variety of services to help citizens get small business grants in Delaware. Most popular are business vehicle loans, commercial real estate loans, business checking services, equipment and machinery loans, and credit lines.

To apply for a loan at a Dover Federal Credit Union location, you must fill out a business loan application and a personal financial statement, which you can find on their website. You also need to have a business plan and be able to show personal tax returns from the past two years. Other requirements are to have a business license from the state of Delaware and to have your business registered within the state.

All these requirements may vary, however, based on your prior relationship with the institution and the type of loan you are applying for.

First Citizens Community Bank

First Citizens Community Bank has two locations in Wilmington. It prioritizes cash flow and transparency, offering digital accessibility with all of its loan information and processing with online banking.

They also offer a host of different loans options, including:

  • Commercial real estate loans, which have flexible and competitive term rates
  • Business lines of credit, which can be repaid based on the flow of your business
  • Agriculture loans, at low rates
  • Equipment loans, for new and used equipment in a variety of industries
  • 504 and 7(a) small business loans of up to $350,000 with an expedited waiting period, and up to $5 million for regular waiting times
  • Business term loans with maturity
  • Letters of credits for larger purchases
  • Accounts receivable financing

Summary

Institution Services Offered
WSFS Bank
SBA 7(a) loans, commercial real estate loans
Dover Federal Credit Union Vehicle loans, commercial real estate loans, business checking services, equipment and machinery loans, lines of credit
First Citizens Community Bank SBA 504, SBA 7(a), commercial real estate, equipment, agriculture, business term loans, and lines of credit

Best Online Delaware Small Business Loan Options

Online bank loans are accessible nationwide and can often be competitive with bank loans obtained within accredited institutions within Delaware. Online loan processes are fast and are easy to fill out.

1. BlueVine

BlueVine is an online lender offering unsecured lines of credit to Delaware-based businesses ever since 2013. The lender only offers funding to businesses from certain industries and not all states, - but, if you do qualify, you can enjoy its excellent customer service and attractive interest rates
Pros
Fast approval and funds disbursement
Easy online application process
Great customized customer support
Attractive interest rates
Cons
Services only available for B2B companies
Not serving some states and industries
Repayments and rates can get high


BlueVine lines of credit do not require collateral. However, this means that you might be faced with slightly stricter qualification requirements. If you do qualify, you can enjoy a business line of credit of up to $250,000, with interest rates starting at only 4.8%. The repayment term can vary between 6 and 12 months, with either monthly or weekly repayment schedule.

The Bottom Line

BlueVine is an excellent option if you are looking for an unsecured line of credit with attractive interest rates. Keep in mind, however, that the lender doesn’t serve all the industries, - so, make sure to carefully review the qualification criteria prior to applying.

2. Fundbox

Fundbox is a reputable online lender offering business term loans and revolving lines of credit to small business owners from Delaware and beyond. Fundbox term loans present a great funding solution to cover a large one-time purchase, while its lines of credit are ideal to support daily business operations.
Pros
Fast turnaround
Easy online application
Low minimum FICO score (600)
No monthly limits
Can set up automatic debiting
No additional fees
Cons
Loan limits aren’t very high
Interest rates can get expensive


Fundbox business term loans can range between $1,000 and $150,000 in value, with a repayment term of either 24 or 52 weeks and APR of 18%.

Lines of credit have a similar limit ranging between $1,000 and $150,000. However, this type of financing comes with shorter terms, varying from 12 to 24 weeks, and a slightly higher APR of 20%.

The Bottom Line

Even though Fundbox small business loans have relatively high interest rates and low limits the lender offers an easy automated application process and exceptionally fast turnaround. In addition, Fundbox offers incentives to repeat customers in the form of lower rates and higher loan amounts.

3. Fora Financial

Fora Financial is a trusted fintech lender that has been offering fast and convenient small business loans to Delaware-based entrepreneurs since 2008. With Fora Financial, qualifying small businesses from a variety of industries can receive a short-term loan or a merchant cash advance as quickly as in 24 hours.
Pros
Funds disbursed within 24-72 hours
Credit score isn’t important for approval
A variety of industries are welcome
Cons
Additional fees are charged
Interest rates can get expensive


With Fora Financial, you can borrow between $5,000 and $500,000 at a factor interest rate between 1.1 and 1.3. Short-term loans come with a repayment term of 4 to 15 months, while merchant cash advances are more flexible and don’t have a specific repayment period.

To be approved for a loan from Fora Financial, you don’t need to have an excellent credit score: rather than looking at the credit score, the lender considers both time spent in business and the overall business revenue.

The Bottom Line

Fora Financial presents an excellent lending option for small businesses who have not built a great credit score so far. With this alternative lender, you can receive up to $500,000 in a matter of days to cover your small business financing needs.

4.Credibly

Among the most popular products is a working capital loan, which works differently from a traditional term business loan. With a working capital loan, you will be charged a lump sum equal to the certain percentage of the loan. This form of payment instead of regular interest rate payments is often easier to budget for.
Pros
Several loan products to choose from
Lenient credit score requirements
Open to high-risk industries
Easy online application
Helpful customer service
High borrowing limits
Cons
Loans come with origination fees
Daily or weekly repayment terms for some loans
Interest rates can get expensive


As an alternative business lender, Credibly offers seven types of financial products:

  • Business lines of credit
  • Long-term business expansion loans
  • Working capital loans
  • Merchant cash advances
  • SBA loans
  • Invoice factoring loans
  • Equipment financing loans

Credibly aims to make small business financing accessible to as wide a range of borrowers as possible. Therefore, the company is willing to consider applicants with low credit scores, starting at only 500.

With such a broad range of lending products, the loan features vary as well. For example, long-term business expansion loans can vary between $150,000 and $5 million in value to be repaid over 3 to 10 years. On the other hand, working capital loans can reach $400,000 in value to be paid back over a period of 6 to 18 months.

The Bottom Line

Credibly is a reliable alternative lender that offers a variety of small business loans to Delaware-based companies. With Credibly, you can benefit from flexible loan products, relaxed eligibility requirements, and helpful customer service.

Additional Delaware Small Business Financial Resources

In this section, we will provide additional financial resources for small businesses in Delaware.

Delaware Prosperity Partnership

The Delaware Prosperity Partnership is run by the Delaware state government and is a blanket term that covers a whole sleuth of business financing grants, research grants, workplace training grants, business networks, and investment networks.

Delaware is essential for any small business owner or entrepreneur. Partnered R&D networks include the Delaware Crossing Investor Group, the First State Angels, the Angel Investment Network Mid-Atlantic, and Leading Edge Ventures. The government also awards EDGE Grants within two tracks: STEM and general startups. Riskier businesses can also be funded through the Delaware Capital Access Program and State Small Business Credit Initiative Participation Loan.

Grow Wilmington Fund

The Grow Wilmington Fund offers Delaware small business loans at below-market interest rates with longer loan terms. The Grow Wilmington Fund is a culmination of efforts between the Grow America Fund and the City of Wilmington's Office of Economic Development. Companies with two to 500 employees, which make between $500,000 and $20,000,000, can apply.

To be eligible for these loans, businesses also have to serve a public function either by creating permanent jobs; serving low- or medium-income areas; being located in redevelopment areas and Enterprise Zone; or serving or being a minority or female-owned business. The loans can be repaid over 10 years, with some specific loans being repaid in 25 years.

The interest rates are fixed at a seven-year treasury rate of 2%. The borrowing allowance is between $150,000 and $2.5 million. The loans can be used to pay for working capital expenses, machinery and equipment expenses, real estate acquisition (not real estate investment), and tenant improvements.

EDGE Grant

The Encouraging Development, Growth & Expansion (EDGE) Grant program gives qualified Delaware companies an edge by providing access to significant financial capital.

Under the program, STEM-based small businesses can receive up to $100,000 to be spent on eligible expenses. On the other hand, Entrepreneur Class (non-STEM) companies can receive up to $50,000. The grant funds are provided as a 3-to-1 state-to-business match and must be used to expand a business’s sustainability and viability.

Some of the eligibility expenses include:

  • Advertising assistance
  • Market analysis assistance
  • Essential equipment
  • Building infrastructure/cosmetic enhancements
  • Website design
  • Rent assistance for lab space

Delaware Site Readiness Fund

The Delaware Site Readiness Fund was established to promote economic stability and growth within the state of Delaware. The Fund does so by investing in the improvement and development of commercial and industrial sites in order to attract job-creating businesses.

The Site Readiness Fund provides loans, grants, and other forms of financial assistance to local governments and qualified small businesses that invest in renovating, construction, or improving infrastructure for sites that will expand or attract new businesses within the state.

How to Prepare for a Delaware Small Business Loan

To obtain a small business loan in Delaware, you’ll need to prepare various documents. The type of documents you require, may vary according to the loan you are applying for.

If you follow the steps listed below, you’ll have a greater chance of obtaining a loan:

  1. Improve your credit score - your credit score will often determine the amount of interest you will pay. A higher credit score will often mean lower interest rates and higher loan payments.
  2. Register your business - registering your business notifies the lenders of your business's legitimacy. Registering your business will also connect you to the state of Delaware so you can be notified of grant possibilities.
  3. Create a business plan - if your small business is a startup, you must create a business plan. A business plan will explain how your business will grow and what you’d be using your loan for. Banks and lenders often look at business plans to see how safe their investments are.
  4. Obtain all legal documentation - this paperwork may show your business's status and is often requested to prove the legitimacy of your business. It’s crucial to show your balance sheets when applying for a loan because lenders are interested in seeing how you earn revenue.
  5. Opening a business checking account - generally speaking, if you show that you have existing lines of credit - either at the place you are trying to get a loan from or elsewhere - it shows that your business is accountable for its debts and keeps track of their expenses.

The Bottom Line

Delaware has a great range of small business loan options and also has a proven track record of being a state that supports small business owners. There’s a lot to consider when choosing a lender to go with. Each loan option has its own advantages and pitfalls. When deciding which loan to apply for, you should consider the type of business you plan to run and how you plan to grow your business.

About the Author

Tetiana Sitiugina-Babiuk

Tetiana Sitiugina-Babiuk

Financial Sector Specialist and Content Strategist

Independent writer, content strategist, and financial sector specialist. Tatiana has an extensive experience in working with financial institutions such as Bank of Canada and Risk Management unit at FinDev Canada. She holds an MA in Financial Risk Management from the University of Toronto.

More about me

Related Loan Picks