Ok, so thank you to all for the good cake vibes--- what I have run into is that the bank doesn't want to give me the loan unless I have almost as much collateral as the value of the loan. From a business standpoint, I understand, but I don't have those kind of assets. If I did, I probably wouldn't need the loan!!

Any ideas on how I can get a loan with little or no collateral? Even with the equipment that I plan on purchasing, its still not enough.

There are a few organizations out there that cater specifically to helping get small businesses started...even in the financial end as well.Many will offer a small interest loan with no callateral that isn't required to be paid back for something like 5 years.You would have to go online to check this out in your state/area.I know here in Canada the government will help get you set up and loan money etc...and help guide you and give you resources and so on...I'm not sure about the US but there should be something similar.

jillmakescakes,

Have you looked into Prosper.com? It's a people-helping-people kind of funding. I listed my loan request, received multiple bids that brought down the interest rate by 5 pts, and after the 7 day listing was up, I was 100% funded by people willing to invest in my bakery business.

hth!

Like pp said, look into groups who help small businesses and *women's* businesses, especially Good Luck!

You should probably look into grants, too--Federal and state and private, as well. Those don't have to be paid back at all.

Look, just don't stop. Two big banks turned me down and it was a small privately owned bank that gave me the loan. I didnt' have as much in home equity (for a 2nd mortgage) as I needed for the loan, but they gave it to me in spite of that.

The first turndowns were the best thing that happened to me. You just never know when and where it's going to come from.

Ok here is another suggestion.
Every state in the US has a Small Business Counsel/ Administration and a Women Business Counsel of some sort. Go to the chamber of commerce in your area ask them what contacts they have for you.

Grants are difficult to get, unless you write grants well or know someone you can pay to write the grant well for you.
It does seem that if you had the money for the collateral for the loan, you had the money you needed already.
It doesnt make much sense but that is finance for ya!

There are Private investors called Venture Capitalists. Most every state has a group or two. Google Venture Capitalists in your state. I dont know if a bakery is thier focus but what can they say worse than "no" ? You have heard "No" already and you have survived it. Push forward, you can do it!
Another suggestion; you could lower your amount. Reduce the equipment and add more elbow grease, look for used equipment. Revamp the purchases, lease versus purchasing equipment, lease space versus purchasing space, find a less expensive place to lease, lower salary etc... Anything you can do to get that amount into line with what the bank can preapprove you for right now. The amount within your current means.

In your future when you make more money and the business is a success you can always upgrade etc...

Sending you love and best wishes.