Anyone owning or operating a small business knows about business loans and why they are important to almost any business.
There are many banks that offer very attractive low-interest small business loans, and they are backed up and guaranteed by the United States Small Business Administration or SBA. Due to the guarantee by the SBA, the interest rate and the terms of repayment are more favorable than most loans. These business loans range anywhere from $30,000 to as high as $5 million.
Terms of loan
When you apply for a small business loan, you will get a lump sum of business capital which you will pay back at a fixed interest rate by regular repayment terms. Most of these small business loans are repaid over 5 years and the funds can be used for any specific investment in your small business.
Where to get a small business loan
You can get a small business loan from many places such as:
- Micro-lenders who are non-profit
- Online lenders
These lenders loan many types of products including:
- Term loans
- Accounts receivable financing
- Lines of credit
How to get a business loan
Although finding, then applying and getting approval for a small business loan can sometimes be complicated, the more prepared you are, the better. Here are 5 steps in getting a business loan. They include:
- Asking yourself, do you really need a loan
- Deciding what type of loan is best for you
- Decide the best type of small-business lender
- Find if you are qualified
- Gather documents
Best small business lender
With the internet being so big in our lives, you might find lenders that work online. One word of caution, anything online can be a scam and you need to be sure of the lender that you are dealing with. So, before you apply for a loan with any lender – research. You should do a google search to see the reputation of the lender you are thinking about. This is something everyone needs to do when spending money with any company on the internet – especially with any company you will be asking to loan you money.