BEST BUSINESS LOANS
AUGUST 2020

Business loans have a few advantages. By obtaining a loan, the lender does not have equity in the business. Instead, you simply need to repay principal plus interest. After repayment, you do not need to share profits with the lender. This also reduces administrative duties by eliminating the need for shareholder meetings and votes. In addition, loans do not require the same regulations on investments.

Lending requirements depend on the business loan service. Often, lenders expect good credit, collateral, and steady monthly revenue for approval. A commercial lender may also request a business plan to prove that a business can repay the loan.

The APR (annual percentage rate) refers to the annualized interest rate charged for your personal loan. Typical APRs range from about 5% up to 30%. The APR of the loan depends on the applicant’s financial history, assets, income, credit history, and other factors.

Repayment agreements depend on the terms negotiated between your business and the lender. Repayment periods can be as low as 6 months or less or for up to 5 years or more. When negotiating your loan, make sure to agree upon repayment terms that suit your current budget.

There are many options for financing your business. Below are a few of the most common types of business loans:
Business Lines of Credit: A line of credit that businesses can access when needed
Equipment Financing: Loans to finance equipment in which equipment serves as collateral
SBA Loan: Low-cost, flexible loans secured by the Small Business Administration
Short Term Loan: Small loans with short repayment terms between 3 to 18 months