Types of Loans for Your Business

Getting a business loan sounds simple — until you realize how many types of loans exist and how many lenders offer those loans. Suddenly, you find yourself overwhelmed by choices that you didn’t even know existed. That’s where we come in. We can help you to navigate the loan landscape and find which loan is the best fit for you and your business. 

The best place to start is by identifying what your specific use will be for the loan. If your objective for the money isn’t clear, it’s safe to say you have work to do before knocking on a lender’s door. Create a solid plan, and then determine the specific amount of money needed to make it happen. Also consider how long you would like to have to pay the money back.

There are many types of loans available to business owners out there. We’ll go through a few of the favorites:

Business line of credit

A business line of credit is revolving, so rather than receiving a lump sum, you can access the money as many times as required. There’s no pressure to dip into the money, but it’s always there. Whether you’re using it to purchase equipment, add inventory, hiring staff, expand to a new location, pay invoices, or add a vehicle to your fleet, you’ll only pay interest on the exact amount of money you use.

SBA loan

The main purpose of the SBA (Small Business Administration) is helping small businesses find the funding and resources they need. In particular, the SBA assists small businesses that are disadvantaged and might not be able to get help otherwise. One downside to SBA loans is they’re famous for being slow and paperwork-intensive. For example, if you submit an application in early July, you often won’t see the funds until August or September. In some cases, it might even stretch into October.

SBA loans are unique because the aforementioned agency isn’t actually the lender. Rather, it guarantees a substantial portion of each loan, which reduces other lenders’ risk and makes them more willing to approve your request.

Before you apply for an SBA loan, you’ll need to gather all the necessary documentation. You’ll need to include your business license, 2 years of business tax returns, 2 years of personal tax returns, YTD Profit and Loss statement, YTD balance sheet, and a debt schedule.

Business term loan

A business term loan is a great way to acquire working capital, expand your business operations, purchase equipment, hire additional staff, or whatever else it is that you need.

Plan on your business term loan repayment terms to be somewhere between 1-5 years. These loans have a fixed interest rate or flat fee, so the payments will never go up during the lifetime of the loan. A major benefit of this loan is it’s easier for you to identify how much you can afford to borrow, while also making it less stressful to pay off.

Merchant cash advance

With a merchant cash advance, you borrow against your future earnings to secure the financing you need. Once you’ve been approved and the funds are advanced to your account, you’ll begin repaying the loan by having an agreed upon percentage of your daily credit card deposits withheld for the lender. Your advance can be used for myriad purposes, so this type of financing has earned a reputation among entrepreneurs for being very flexible.

Startup loan

It will always be tough to build a business, but you don’t have to bootstrap things to the extreme. A startup loan gives you the capital necessary to lease office space, build inventory, purchase equipment, hire and train staff, and cover your other regular expenses.

To qualify, it’s usually necessary to have a credit score of 680 or higher. A lender will also want proof that you have experience in the industry related to your small business. Some lenders will also request collateral to secure your loan. This assurance might include personal assets like a house, car, or boat.

Thinking of Starting a New Business?

Now is the time! With our society ready to get back in action (safely), new business concepts are quickly emerging with creative flows for serving the public without the high risk of spreading the virus. Put your innovative business concepts into play, and connect with us to get the funding you need to start your newest venture!

Financial restraints have been a complaint for many of the dreamers, limiting themselves to their immediate funds. There is an alternative. If you have the dreams and decent credit, Small Business Loans and No Doc Loans are available to you. Our goal is to provide you with the knowledge you need and the resources available to make your dream a reality. Give us a call – we have the education and the perspective to help you obtain the loans you need for your small business. Visit our website or give us a call to find out what financial backing is available to make your business soar!

Unsecured Finances has over 10 years in the consulting business! We specialized in educating and assisting clients on acquiring Unsecured Business Loans and Start-Up Business Specialty Loans including; Unsecured No Documentation (No-Doc Stated Income) Loans, Unsecured Business Loans, and Unsecured Start-Up Business Loans and Lines of Credit from $10,000 to $500,000 without Assets.

Apply on our website to find out if you qualify, or call today for a free consultation: 1-888-294-2584

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