3 Things Know About Business Loans

www.asisloans.com provides national and international financing tools for any business owner. They offer all types of business loans including commercial loans, construction loans, portfolio loans, financing loans, and investor residential loans. With on-time financing, a team of professionals, and a unique underwriting approach, “AS IS Loans” is an excellent source for business loan consulting. They focus on finding solutions, not issuing denials. 

With years of financial experience, “AS IS Loans” ensures business owners have the capital they need. AS IS Loans is ready to supply business loans regardless of the property, condition, location, price, or credit.

Their consulting services support all business types for any business purpose, whether business loans are for mergers, acquisitions, or restructuring. They even offer a specific type of financing for energy businesses. With so many loans options, we will start by discussing the types of business loans available and the uses for each.

1. What Are the Types of Business Loans?

Large and small business loans are widely available from various kinds of lenders and can be used to help a business grow, fund new research, or cover marketing expenses associated with hiring new employees. Business loans come in different packages and with varying benefits, so a business should understand the many types of business loans and select the right one for their current needs.

Small Business Line of Credit

These loans allow a business to have direct access to a lender’s funds. A line of credit is a capped amount but is useful for managing a business’s cash flow and unexpected expenses. There is typically a fee for setting up this loan, and businesses pay interest monthly to amortize the principal.

Accounts Receivable Financing

This line of a credit is a credit facility secured by the company’s accounts receivable (AR). An AR line allows a business to receive cash immediately depending on the level of their accounts receivable. The interest rate varies, and a business’s customers pay off the principal.  

Working Capital Loans

These loans are a borrowing vehicle for businesses to finance daily operations, such as managing seasonal fluctuations in revenue and expenses. A business with little or no credit history will have to pledge collateral for this loan.

Small Business Term Loans 

These loans are issued for a set dollar amount, and a business uses these loans for its operations, capital expenditures, or expansion. Interest accrues monthly, and the principal is repayable within a few years.

SBA Small Business Loans

These loans are low-interest and guaranteed by the U.S. Small Business Administration (SBA). With an SBA guarantee, the repayment terms are more favorable than those of other loans. However, the loan process is time-consuming because of the strict eligibility requirements.  

Equipment Loans

These loans cover the purchase of business equipment and require a down payment of 20% of the purchase price. A business’s equipment includes tools, vehicles, and software.

Small Business Credit Cards

This line of credit is best for short-term financing. Issuers of credit cards typically offer promotional introductory rates of 0% along with cashback and rewards programs.

2. What Are Some Reasons You May Need a Business Loan?

Two primary reasons a business seeks a loan are for immediate financing and to build a strong credit score. Both new and existing businesses encounter situations where they need capital, and business loans introduce a business to several lines of credit.

Immediate Financing

When a business needs to buy new equipment, hire new employees, or is ready to expand its operations, business loans provide them with the working capital instantly. Businesses can avoid meddling with their revenue streams and open a line of credit which they can pay off later. Immediate financing may be a risk since a business’s growth takes time, but the benefits will usually pay off quickly.

Strong Credit Score

Whether a business has bad credit or no credit history, business loans can help them increase their credit score for more credit options. A credit report reflects how reliable a business is in making loan repayments. Making timely payments is a signal to lenders that they can trust a business that is asking for capital. With a good credit score, a business has access to more loan options with lower interest rates and better terms.

3. How Do You Apply for a Business Loan?

All a business needs to apply for a loan is the right financial information. Applying for business loans is an easy step-by-step process:

Step 1

If a business decides it needs business loans, they must calculate how much a loan’s principal and annual (or monthly) interest is. A business loan calculator is a tool for determining the right amount for a loan based on a business’s cash flow.

Step 2

After calculating the right loan amount, a business should explore the loan options given their credit score, credit history, industry, and borrowing duration. Depending on these factors, some loan options won’t be available for a business.

Step 3

Once a business decides on three to six business loan options given their financial circumstance, it is time to gather and organize the documents necessary for a loan application. Bank statements, licenses and permits, tax returns, and proof of collateral are a few of the documents a loan provider will ask for.

Step 4

The last step in the loan process is to look for a lender. A business can find lenders online on peer-to-peer lending sites, but traditionally, a commercial or local bank can act as a lender. Once a business finds a lender and applies for a loan, a lender will carefully consider the business for loan approval.

Conclusion

“AS IS Loans” is eager to help businesses find the capital they need to survive and grow. They offer the best business loans and investor financing solutions. Speak to a professional and friendly loan advisor over the phone at (800)-611-2747 or visit www.asisloans.com.

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