Trust First National's banking experts to know your financing options
When Dr. Jerry Hu started thinking about designing and building his new practice in south Anchorage, the Soldotna-based dentist didn’t hesitate. He insisted on discussing his financing options with First National Bank Alaska Senior Vice President Charlie Weimer.
“Charlie knows my personality so well because he’s known me so long,”Hu said.“I’ve never been a big fan of carrying interest on a loan if it wasn’t necessary. If I had choices, I knew Charlie and First National would spell them out for me.”
Weimer described to Hu the Small Business Administration’s (SBA) 504 loan program. It is designed
to provide financing for the purchase of fixed assets, which usually means real estate, buildings or machinery, at below-market rates.
The 504 program consists of three parts. The business owner contributes a minimum of 10 percent with a traditional lender like First National providing 50 percent. A certified development company (CDC), in this case Evergreen Business Capital, finances the remaining costs.
The program allows the business owner to retain more working capital to grow the business.
“I still like to joke with Charlie about there being a lot more paperwork to fill out than I expected,” Hu said.“But the long-term benefits proved to be quite awesome.”
When it’s time to expand your business, start by breaking down your business plan with a First National banking expert. You’ll learn about loan options available to help your company grow. Some examples include:
• Electronic Health Records (EHR) financing – Custom options help healthcare providers convert from paper to digital health records.
• Equipment and vehicle loans – Keep your competitive edge with an equipment loan to purchase
computers, vehicles, heavy equipment or other machinery. Repayment terms are dependent upon type and age of collateral.
• Inventory financing – Whether you need inventory for growth or must meet seasonal demands, this loan will help you keep plenty of stock on hand. Inventory financing is also convenient for businesses in remote locations. Pay off the loan through the sale of financed goods. Collateral is usually the inventory financed, though additional collateral may be required.
• Letters of credit – Documentary and stand-by letters of credit are arrangements often used by import/export business, contractors and travel agencies to serve as assurance of payment. Documentary letters of credit are usually for less than six months. A stand-by letter of credit may be renewed annually.
• Revolving line of credit – Meet working capital needs or bonding requirements without having to go through the application process each time with a revolving line of credit. Collateral and repayment terms are established on an annual basis and tailored to your needs.
For more information about business loan options, visit FNBAlaska.com/BusinessGrowth or contact First National at 777-4362/1-800-856-4FNB from communities outside Anchorage.