A business loan can help you finance general business needs like inventory, equipment or vehicles. Prequalifying for multiple business loans using a loan marketplace can help you compare many loan offers at once to find the right loan for your situation. Both secured business loans and unsecured business loans are good options to finance your business, but one may be better than the other depending on your specific situation.
Common Uses for a Business Loan
The application may require a detailed business plan, financial statements and a description of what the loan will be used for —meaning they can take longer to fund than some online options. Traditional bank options include term loans, lines of credit and commercial real estate loans to buy properties or refinance.
It’s important to understand how each loan works, so you can choose the best option for your business. Below, CNBC Select reviews nine types of small business loans that can benefit your company. Certain restrictions apply to refinancing options and are subject to program terms. With a business loan you’re loaned a lump sum of money you then repay with interest in fixed monthly installments.
Interest only accrues on the portion of the credit line being used, making it a good option for business owners who need access to capital over time. Borrowing limits generally range from $2,000 to $250,000 and APRs start at around 7%. Financing a business with no money won’t be an easy task, but there are options. From business loans and credit cards to grants and venture capital, here are your best financing options. A conventional lender can be an option if you have a good credit score and small business finances. In case you don’t meet these requirements, you can look online for less traditional loan options, such as a merchant cash advance.
What does it mean to refinance a business loan?
Lenders may charge upfront fees to process your loan application. Projecting these fees and factoring them into the equation can also help you compare costs. Choosing the best business loan comes down to comparing loans you qualify for and determining which loan is the right fit. If you opt for funding from a bank, a small bank may be a better option versus a larger one. A majority of borrowers were satisfied with their experience and few were frustrated by long wait times, according to the 2023 SBCS survey. Fewer borrowers who worked with large banks were satisfied with their experience and more were frustrated by long waits for funding.
When researching your loan options, look into banks and other lending institutions that offer business loans. While large banks can fund more significant loan amounts, alternative lenders may provide quick approvals and have less stringent funding requirements. Working How Can I Get a Business Loan with a local bank also allows you to develop a rapport with the lender. Having that personal connection can afford you more flexibility in the future. A startup business loan offers funding for new businesses to help them get off the ground or expand their operations.
Quick loans also can give business owners the ability to purchase businesses, real estate or other assets quickly without waiting for traditional financing to close. This makes it easier to take advantage of opportunities when they arise.
