A term loan is the loan most business owners think of when they need financing for their business.
A term loan is repayed in regular payments over a specified period of time.
Amounts and payment terms vary depending upon the credit worthiness of the borrower.
A term loan is what most people think of when they think of a business loan.
These loans have a set repayment time, set number of payments, and have a fixed or variable interest rate.
Term loan options depend on the business needs, credit rating, cash flows, and various other factors.
Term loans are provided by both traditional banks and non-traditional lenders.
A small business term loan can be used for almost any business need, including specific purchases such as equipment, inventory, working capital, new business opportunities, etc.
Usually, term loans are for businesses who’ve been operating for more than 2 years.
The rate, length of the term, and maximum loan size is typically a function of your revenues and credit rating.
Most likely, you will need to provide tax returns (both personal and business), financial statements (e.g. profit & loss, balance sheet, etc.), bank statements, and a signed application.
The actual cost will depend on your credit, the lender’s product, and other factors in the lender’s underwriting criteria.
But in general, for every $1 borrowed, you will pay back between $1.05 – $1.30 per year on a typical term loan.
