Whom do you go to when your business needs funds to bridge cash flow gaps and enough working capital to cover the mandatory operation cost? Often times a business owner need to borrow cash from lending institutions for business expansion or to pay off an outstanding debt. With the advancement in the small business industry, we see a significant rise in the number of a lending institute. Multiple business loans are available in the market to satisfy every borrower’s need. Need equipment for your printing business applies for Equipment Financing. Running a business from home, apply for a Home Based Business Loan. In addition to this, if you need extra cash flow to meet long-term financial need such as business expansion costs or a cost of a new project, then a Term-Loan is the most effective funding option for your business.
Depending on the need, a borrower chooses from a short-term loan, an intermediate-term loan, and a long-term loan. The difference lies in the lifespan of these loans, which is quite evident from the titles of these loans. Evaluate your business needs, apply for a term loan, a loan can help you get rid of any financial dilemma.
Propitious feature of a Term Loan
Before applying for a loan, a borrower must study its features and benefits.
- Lenders offer a term-loan in a lump sum of the money, and borrowers make repayments based on agreed weekly, monthly, or yearly basis.
- Low-interest rate makes it affordable and user-friendly.
- If your annual revenue is over $300K, and you have a credit score of 680, and been running a business for three years, applying for a term-loan is a piece of cake for you.
With these promising features, you can use a term-loan to capitalize your business and push it the direction of success and prosperity. As a small business owner, you can use the funds from a business loan in multiple ways – to list down, here are some ways:
- To increase manpower.
In this crippling economy, business owners are reluctant to hire more employees due to financial limitation and restrictions. All factors considered, for the growth of business, employees are a key element. And if you are thinking about expanding your business, you must have enough manpower to attend the incoming customers. Research suggests that hiring and training of employees can be very expensive; most business owners take help from the social media platform to find the perfect gem for their businesses. Here, a business owner can take benefit from the long-term feature of a term-loan to cover the payroll of the employees. More manpower results in more productivity, eventually leading to more profit and growth of the business.
- To take up a new venture.
A term-loan allows a business owner to invest in another project without dismantling the savings of the previous business or disrupting the incoming cash flow. Running a second business can be a nice addition to your assets, and the profits from the business can strengthen your financial standing. With the flow of funds, you have the liberty to transition your dream business into reality.
- To tackle mega projects.
In order to run a project on a large scale, you need a lot of funding. Opportunity doesn’t knock at the door again and again, so if you are dismissing a huge project because of the lack of funds, think again! Running huge projects demands rigorous and extensive research, development, and training. In this case, a business owner should apply for a term-loan as these expenses can be long term. Fast and accessible funds can help you streamline the cash flow, hire new staff, hold training sessions, set-up arrangement, and buy new and upgraded equipment and technology. Working on a mega project is no less than an upgrade, and a term-loan can lend a helping hand throughout this process.
- To introduce another service.
If you want your small business to be a huge hit, a constant addition, and upgrade of products and services are a must! Knowing it is hard to launch a new product or introduce another service in the market without six-figure savings, as a business owner, you can take help from external funding. With the increase in cash flow from a term loan, you can buy a delivery truck or a bike and offer home-delivery services to your clients resulting in more profit for your restaurant business. Services like these help build a quality customer-seller relationship. Conduct research on your targeted audience and use the business loan to implement profitable strategies and launch the products as per the demand of the customers.
- To pay off the pending debt.
Paying off a pending debt or refinancing a business means that you have to use funds from a business loan to clear your outstanding debt. Being stuck in the vicious loop of debt is a threat to business growth. Every business owner aims to get rid of existing debt as soon as possible, and funds from term-loan can help achieve that aim. But before using all of the loans, you must have enough capital to pay off the newly borrowed loan. In addition to this, lenders are interested to know about your business plan; if you are going to them with a poor financial number, the chances of loan approval are slim. As they have a hard time believing in you paying this newly incurred debt on time.
So, strengthen your business by using the term-loan for business expansion or for production reason. In this way, the cash flow stream will never stop flowing, and you will be going out with more money than you came with.
For the eligibility criteria, pros & cons and benefits of a term-loan, head over to our website, apply for a term-loan and use it to your benefit. For daily updates, you can follow us on Twitter (@Onlinecheck) and Facebook (@Onlinecheck). If you have any query feel free to call us on our toll-free number at (833) 827-4412, our experts will guide you.