It was pouring down raining in the dead of the Los Angeles winter when the now-famous frozen yogurt shop, Pinkberry, opened its doors. Sales in the first month were a meager $70. But owners Shelly Hwang and Young Lee had a vision, and within a few months of opening they were turning a profit. Today, the trendy shop is a bi-coastal hit with an eye towards even further expansion.

The Pinkberry success story proves that if you have the right plan, a well-placed product and the perseverance to see your business through, your entrepreneurial dreams can come true. But it all starts with funds. Raising capital is one of the most important and challenging parts of opening a small business. If you don’t need a huge amount of capital to open your business, a small business loan is probably your best bet.

The current economic waters may be murky, but there is still money to be had for small business entrepreneurs who have their ducks in a row. There are two types of small business loans, government-backed loans and lender-backed loans. In general, your local commercial bank or lending institution will handle the paperwork for both of these loans.

Applying for a small business loan begins with creating a small business blueprint that includes a formal business plan. The lender needs to know that your product or service is in demand and that you and your management team are able to run the business. To make this determination you need to provide a description of your business, research about your industry, projections for cash flow for at least one year, personal financial statements and key personnel resumes.

The Small Business Administration offers guidance on how to prepare the necessary documentation to get a small business loan. You can also meet with a loan officer in advance to discuss what you need. Expect to have to put up some collateral or equity to secure the loan. Once your loan documents are reviewed, you may be asked for additional paperwork. If you don’t meet the application requirements for your lending institution, all is not lost. You may be able to qualify for a government-backed loan from the SBA, which often has more flexible requirements.

—For the best rates on CDs, mortgages, savings, credit cards and more, enter your ZIP code at