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Jan 11, 2022 · Here are the 13 most common types of business loans. There are many reasons why your business might want to borrow money, and there are many financing options available to get the job done.
- Term loans. Businesses looking to expand. Business owners who have been operating for at least six months. A business term loan is one of the most common types of business financing.
- SBA loans. Businesses looking to expand or refinance existing debts. Strong-credit borrowers who can wait a long time for funding. An SBA loan is a type of small-business loan that is partly guaranteed by the Small Business Administration and offered by banks and other lenders.
- Business lines of credit. Short-term financing needs, managing cash flow or handling unexpected expenses. Seasonal businesses. A business line of credit is a revolving source of funding that provides your business access to funds up to a predetermined amount.
- Equipment loans. Businesses that want to own their equipment outright. Major equipment purchases. Equipment loans are a type of small-business loan that is designed to finance equipment, which can include things like semi trucks, other commercial vehicles, commercial fridges or office furniture.
Jul 31, 2024 · There are nine types of small business loans that businesses often select for funding. The type of business loan impacts the rates, terms and loan amount. Small business loans usually range...
- The needs of the small business determine which loan option is best. For example, an equipment loan would be ideal if a small business needs to pur...
- The most popular type of SBA loan is the 7(a) loan. In the 2023 fiscal year, the SBA approved shows approvals of 57,3562 7(a) loans, equaling $27.5...
- Microloans are a popular option for starting a business. They offer up to $50,000 to new businesses needing capital to cover startup costs and smal...
- Alexandria White
- Term loans. Term loans are one of the most common types of small business loans and are a lump sum of cash that you repay over a fixed term. The monthly payments will typically be fixed and include interest on top of the principal balance.
- SBA loans. Small Business Administration (SBA) loans are enticing for business owners who want a low-cost government-backed loan. However, SBA loans are notorious for a long application process that can delay when you will receive the funding.
- Business lines of credit. Similar to a credit card, business lines of credit provide borrowers with a revolving credit limit that you can generally access through a checking account.
- Equipment loans. If you need to finance large equipment purchases, but don’t have the capital, an equipment loan is something to consider. These loans are designed to help you pay for expensive machinery, vehicles or equipment that retains value, such as computers or furniture.
- Term Loans. Business owners who want to make investments in specific business areas or have an ongoing need for working capital. You only need capital for emergencies or occasional, one-off situations.
- Business Lines of Credit. Business owners who want a cash cushion for cash flow gaps or emergencies. You want to invest in expansion or other long-term business goals.
- SBA Loans. Business owners with great credit who are seeking long-term loans. You’re in need of quick capital or have low credit. The U.S. Small Business Administration (SBA) doesn’t provide business loans, but partially guarantees loans that banks and other lenders make to small businesses.
- Equipment Financing. Business owners who need to purchase or lease business equipment, machinery, or vehicles. You don’t have an immediate need for business equipment, machinery, or vehicles.
Businesses can use many different types of financing to fund their business expenses, including term loans, business lines of credit and merchant cash advances. To decide which type of financing is right for your business, ask yourself: What is the loan going to be used for?
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Jan 9, 2024 · There are many types of business loans that you can use to access capital quickly — whether it’s for operating expenses or financing a high-value transaction. The best funding option depends...
