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The Answer to Starting Your Own Business or Expanding the Already Existing One

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Have you always dreamed about having a business of your own but there always persisted one problem-money? A warm Italian restaurant or a small shop just around the corner? Well, we have the solution for you-business loans. They are created solely for financing small businesses and are just the answer to your prayers. You can borrow a little or a lot with alleviated terms and conditions for any purpose you might need them nevertheless if you are starting something new or if you want to expand your existing business.

There are a few types of loans according to the purpose.

1. Term loans

They are suitable for a number of uses and can provide you with a larger amount of money that you must pay back over a longer period of time including the interest. They are one of the most commonly used loans in the business area. They can be used by business owners that are ready for the expansion of their business and need to upgrade their inventory and equipment or by businesses who need to short-term financing in order to regulate some temporary cash flow gaps. The loan amount can go anywhere from $10,000 to $1 million with interest rates (fixed or variable) from 6% to 30% paid back over a specific period, somewhere between one and ten years.

Short-term loans are usually linked to smaller amounts of money paid back over a short period of time, usually in 18 months or even less while long-term loans are connected to borrowing higher amounts of money and repaying them sometimes up to 20 years and more.

2. Equipment and construction loans

If you need equipment such as commercial stoves, vehicles, machinery, and computers in order for your business to run smoothly but you lack the money, this is the right loan for you. We all know how pricey the equipment can be but if you have a constant revenue stream, without a problem you can be suitable for one of these equipment loans. Usually, in most of the cases, the equipment itself serves as a collateral and you can finance up to 100% of the equipment's value.

3. Small Business Administration Loans

These loans are best for already existing businesses or startups that are on the verge of expanding or for business owners that have problems with qualifying for the traditional ones. Several loan programs are included and they all have different target customers.

  • The first 7(a) loan can be used for construction costs, for renovation or buy property, to purchase equipment or inventory, or to refinance existing business debt.
  • The second type, the microloan program can provide you with as much as $50,000 with a maximum 6 years repay period. This loan is in particularly helpful for the small businesses to expand and develop.
  • And last but not least important are the CDC/504 loans centered around large-scale real estates and businesses who need with solid $15 million net worth and can borrow as much as $5 million.

You may also read more about How Can My Startup Get A Business Line Of Credit?


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