What Type of Loan Is Best for You |
Posted: July 26, 2017 |
Obtaining a loan is a very common undertaking considering that there is so much to gain from it. If you want to start a new business or if you want to make an investment with the top-earning companies in the state, all you need to do is to obtain a loan. It basically depends on your purpose, other than devising ways to process payroll. So are you thinking of obtaining a loan? What type of loan is best for you? What type of loan will not be too burdensome for your needs? Different Types of Loans 1. Business Loan This is perhaps the most common type of loan and what is resorted to by most people who are seeking for small business start up loans. This is also a good option if you have in mind outsourcing your small business to incur lesser expenses and more profit. In Lendio Business Line of Credit, they usually offer a loan term of 1-2 years with a starting loan amount of $1,000-$500,000 depending on your credibility and capacity to pay. This type of loan is often resorted to by those who already have a good credit standing and have assets to secure their loan. 2. SBA Loan SBA Loan is a type of business loans that is specifically designed to help small businesses. They are offered by the government in support of those who doesn't have any knowledge on how to get business loans from financial institutions. For starters, this is a very good option since they offer a longer loan term of 10-25 years and higher loan amount of $50,000-$5,000,000. 3. Short Term Loan As the name suggests, short term loans offer shorter loan term of 1-3 years with a loan amount of $2,500-$500,000. Unlike the abovementioned type of loans which are paid on a monthly basis, short term loans are usually paid daily, weekly or bi-monthly. This is a wise choice in cases of emergency or if you want to secure a solution for temporary cash shortage. 4. Equipment Financing Obtaining a loan doesn't mean obtaining cash. Sometimes, you want to purchase a new truck or a new van for business expansion. If that is the case, then an equipment financing will help you on the matter. There are several equipment financing options to choose from, depending on the type of equipment you are planning to purchase. Of course, the loan amount is very flexible in relation to the value of the equipment. 5. Business Acquisition Loan Are you planning to purchase an existing franchise? Do you have a company in mind, which you want to purchase? If that is the case, then you may need a business acquisition loan. This may not be the most common type of loan, but it can still give you what you want. Simply prepare a business plan, financial projections and necessary details to prove that the said business or franchise will be profitable enough.
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