Texas boasts a large, diverse economy (energy, technology, agriculture, manufacturing, hospitality), which gives businesses multiple paths to growth — but also intense competition. Lenders often evaluate industry risk, regional trends (e.g. weather, energy pricing), and local credit markets when making decisions.
As a Texas business owner, you can benefit from state-level guarantee programs, CDFIs (community lenders), and local networks in addition to federal SBA and bank options. Knowing which programs are available in your region will help you structure better financing.
These are competitive advantages Texas offers to small business borrowers:
Texas administers two TSBCI programs:
Capital Access Program (CAP): Helps lenders create or use a loan loss reserve (LLR) for small business loans ($5,000 to $5 million) to reduce risk. Texas.gov
Loan Guarantee Program (LGP): Guarantees up to 80 % of unpaid principal on enrolled loans from $5,000 up to $20 million to encourage lenders to make riskier or underserved loans.
These programs don’t lend directly to businesses, but by participating lenders can offer better rates or take on deals they might otherwise reject.
Offers zero-interest capital to eligible CDFIs, which then make interest-bearing loans to qualifying micro-businesses impacted by declared disasters.
Helps fill financing gaps after storms, floods, or other emergencies.
BCL of Texas: Provides “full-cycle” lending and coaching to small and disadvantaged businesses, especially in Austin, Dallas, and surrounding areas. bcloftexas.org
TruFund Financial Services: Offers SBA 7(a) Community Advantage, contractor mobilization loans, short- and long-term CDFI products in underserved Texas markets. TruFund
Clearinghouse CDFI: Works in Texas on community-centric financing for small business, nonprofits, and commercial projects. Clearinghouse CDFI
Use online tools like the CDFI Locator (via OFN) to find certified lenders near you. OFN
These are not Texas-specific, but commonly used by Texas business owners:
The SBA’s primary small business loan product for working capital, acquisitions, refinancing, etc.
Many Texas banks (e.g. Texas Capital Bank) offer 7(a) loans from $500,000 up to $5,000,000.
Designed for fixed-asset investments (real estate, major equipment) with long, fixed rates.
Available via Certified Development Companies (CDCs) in Texas.
Loans up to $50,000 via SBA intermediaries (CDFIs, nonprofit lenders).
Good for startups and very small capital needs.
The SBA provides business physical disaster loans for Texas businesses in declared counties (e.g. for storm or drought damage) up to $2 million.
EIDL (Economic Injury Disaster Loans) support working capital when disasters disrupt revenue.
Texas Capital Bank offers both SBA 7(a) and 504 loans with tailored terms for real estate and equipment in Texas.
According to BigLaw Investor, top banks in Texas by SBA loan volume include Wells Fargo, PNC, Frost, Wallis, Live Oak, Cadence.
Local / community banks and credit unions often participate in TSBCI or local loan guarantee schemes, making them more willing to take on risk. (Referenced in program descriptions)
Define your need: Working capital, equipment, real estate, expansion, or disaster recovery?
Check local CDFIs or nonprofits first — they tend to have more flexible criteria in your region.
See if your lender is TSBCI-enrolled — guarantees might improve terms.
Consider stacking funding — for example, a microloan + local grant + bank loan.
Prepare a strong application package — tax returns, financials, business plan, collateral, etc.
Apply early for disaster relief — Texas has rolling deadlines in affected counties.
Many lenders expect 2+ years in business, stable revenue, good credit.
Collateral or personal guarantees are often required, especially for larger or riskier loans.
In rural or border counties, lender access and appraisal valuations can be more difficult.
For disaster-affected regions, evidence of damage, insurance claims, and timely documentation are crucial.