Does your version of hell look like a cramped cubicle? Would you rather get a root canal than slave away to make someone else rich?
Making your own startup could be your path to finding freedom!
But as the old saying goes, “it takes money to make money.” And unless you have several thousand dollars lying around, you’re going to need to find a way to finance your endeavors.
Luckily, you don’t have to go into the search blind. Here are some of the most useful types of small business loans that can give your startup the boost it needs!
When most people think about loans, they think of term loans.
In a term loan, the full amount is given as a lump sum. That amount is paid back—with interest—across a set number of monthly payments.
Term loans are most helpful when you are looking at a large purchase, such as real estate or equipment purchases.
You can apply for term loans at almost any bank.
There are a number of types of term loans that you might apply for. But as a small business owner, few are as useful as an SBA loan.
An SBA loan is a term loan that is guaranteed by the Small Business Association. That guarantee allows the lenders to charge less in interest, and when you’re launching your startup, that means lower overhead.
However, that guarantee means that the standards for lenders are higher. The application process is much more stringent for an SBA loan than for a normal term loan.
If you don’t qualify for an SBA loan, you might think that you have no choice but to accept the higher interest rates that a conventional lender might offer you.
However, there is another option: peer-to-peer lending.
These loans are funded by private individuals and are usually found online. Because you’re working directly with another individual, you bypass many of the fees associated with a large bank and can access money more quickly.
However, without the support of a larger institution, this individual takes on all the risk of your loan. As such, these lenders may charge higher interest rates to help mitigate that risk.
But, if you’re looking for quick funding, that higher interest may be worth it.
Line of Credit
One of the most important parts of any business plan is working capital. This is the money that you have on hand to pay for overhead, purchase inventory, make payroll, and any other expenses that you might have.
But as any seasoned entrepreneur can tell you, working capital fluctuates. And sometimes, those fluctuations are larger than the amount of cash you have on hand.
A line of credit is the perfect solution for that.
Unlike a term loan that is paid in a lump sum and repaid monthly, a line of credit works like a credit card. You have access to a certain amount, which you can use at any time. If you don’t use that credit, you don’t have to pay anything back.
If your cash flow goes through cycles, a line of credit can be the perfect way to stay in business.
What Types of Small Business Loans Are Right For You?
Startups carry a huge potential for profit. But if you can’t pay your operating expenses, you’ll never even get off the ground.
If you’re looking for financing options, contact us. We offer many types of small business loans, and can even get cash to your account in 48 hours!
Apply now, and start making your business dreams a reality!