You work hard for the money, so make that money work hard for you. Businesses often fall short on capital and need a boost. That’s where short term business loans come into play.
Short Term Business Loans Defined
Need a quick infusion of cash for your business? You’re not alone. The National Small Business Association conducted a study that reveals not having enough working capital can make or break a small business. These quick turnaround loans give businesses the ability to borrow fast cash for emergencies, cash flow problems or business opportunities. Best of all, they’re paid off quickly, which means business owners can focus less on managing heavy loads of debt and more on growing their thriving business.
Pros and Cons
As their name implies, these loans come with short repayment terms. That’s a double-edged sword for many business owners. Depending on the type of loan, you may find yourself making daily or weekly payments, which could be tricky if you’re having a cash flow problem. On the upside, the cost of accessing this working capital is generally less than if you go with a more traditional loan option. Other pros and cons include:
Pro: Even if your personal credit is less than stellar, you’ll still likely qualify
Con: Payments are typically higher and more frequent than traditional loan options
Pro:Pro: There isn’t a ton of paperwork, and you can use the funds for many different business goals
Loan Options
Like everything else in the financial world, short term business loans aren’t a a one-size fits all type deal. Luckily, there are four main types of loans to choose from, which makes it more likely you’ll find an option that works for you. Types of loans include the following:
Merchant cash advances, which are kind of like a “Back to the Future” type option. They provide easy access to business funding by allowing lenders to buy your credit card sales. This forward-looking loan option gets repaid from your point of sale (POS) system, delivering a percentage of your daily sales right to the lender.
Business lines of credit work similarly to a credit card. You get a credit limit that you can use when you need to and repay over time. It typically gives you more favorable interest rates than credit cards and you only pay interest on what you spend.
Invoice financing is a short term solution for that stagnant cash flow caused by invoices that remain unpaid. Lenders give you a percentage (typically up to 90 percent) of the outstanding invoices’ worth. Those invoices are used like collateral. Lenders take a percentage once they’re paid.
Short-term loans work much like regular loans. You get a set amount of money to pay off according to a set payment schedule. Unlike traditional term loans, these loans are paid quickly, typically with daily or weekly payments to the lender — easy, peasy.
No matter what type of loan you’re considering, make sure you do your homework before signing on the dotted line. Check rates with a couple of different lenders and consider the factors most important to you (low rates, fast access, repayment terms) to choose the business loans that’ll give you the cash infusion you need without raking you over the coals later. … Read the rest
You work hard for the money, so make that money work hard for you. Businesses often fall short on capital and need a boost. That’s where short term business loans come into play.
Short Term Business Loans Defined
Need a quick infusion of cash for your business? You’re not alone. The National Small Business Association conducted a study that reveals not having enough working capital can make or break a small business. These quick turnaround loans give businesses the ability to borrow fast cash for emergencies, cash flow problems or business opportunities. Best of all, they’re paid off quickly, which means business owners can focus less on managing heavy loads of debt and more on growing their thriving business.
Pros and Cons
As their name implies, these loans come with short repayment terms. That’s a double-edged sword for many business owners. Depending on the type of loan, you may find yourself making daily or weekly payments, which could be tricky if you’re having a cash flow problem. On the upside, the cost of accessing this working capital is generally less than if you go with a more traditional loan option. Other pros and cons include:
Loan Options
Like everything else in the financial world, short term business loans aren’t a a one-size fits all type deal. Luckily, there are four main types of loans to choose from, which makes it more likely you’ll find an option that works for you. Types of loans include the following:
No matter what type of loan you’re considering, make sure you do your homework before signing on the dotted line. Check rates with a couple of different lenders and consider the factors most important to you (low rates, fast access, repayment terms) to choose the business loans that’ll give you the cash infusion you need without raking you over the coals later.
… Read the rest