November 26, 2020

Financing Your Business

When you are starting or improving a business, you may need to need a way of getting the money you need to help. It is important to make sure you educate yourself on the different types of financing options available. If you need a small amount of money, you may want to use credit cards or a personal loan. This can be an alternative for the capital you need. If you need a larger amount, you can do research on bank loans or bank lines of credit. Some revolving lines of credit can give you a more competetive rate than a traditional loan. To draw on your revolving credit line, you simply write a check in any amount, up to your available credit limit and deposit it into your regular business checking account. You then repay the amount borrowed through monthly payments that can usually be deducted directly from your business checking account.

The interest rate on a line of credit is based on the prime rate of interest and fluctuates as the Prime Rate changes. Another option for raising capital for your business, is to look into getting a Small Business Administration loan. The SBA guarantees loans from commercial banks that provide the capital for the business loans. Another option to consider for a way to get business financing, is to look at a business installment loan. This is a fixed or variable rate loan, available in amounts from $3,000 to $350,000 for a specific length of time. Usually this type of loan is extended for a period of one to five years. These funds can help finance capital expenditures like new equipment, a redesign of your offices, or expanding your business. Another option for raising money you need to finance your business, is through an unsecured working capital loan. These simply are loans for working capital that are unsecured, only based on the credit worthiness of the applicant. If your business has equipment you own, you can get a equipment financing loan.

In this type of loan, you are using the equipment as your collateral for the loan. Equipment Leasing is an easier way to find financing for your equipment needs and obtain tax benefits at the same time. If you are an existing business and take credit cards, you may be able to get a merchant account cash advance. With this type of loan, you are getting immediate cash now in return for a percentage of your monthly credit card sales being taken from the company you took the advance with. It is very important to make sure you have a business plan before trying to apply for business loans. By having a business plan, you are increasing your chances of being approved for the loan you are seeking. If you do your research and fully educate yourself on the type of business financing you are looking for, you will definitely be more prepared and receive the best financing option that is right for your business.

Leave a Reply