Many small business owners normally consider that if they can’t get a loan from banks, they are out of options. But that is not true. There are many types of business loans available in the lending market than ever, and just before you start looking for your business financing option, you need to know this. Merchant Advisors is here to help small business like you to get the funding you deserve.

Small Business Administration (SBA) Loan

An SBA loan is government-backed, long-term funding that is made by the Small Business Administration lenders that will help small businesses who may had been develop to become down by means of the traditional bank to get low-interest funding that may be used for many small business functions.

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  • Maximum Loan Amount: $5,000 – $5 million
  • Term: 5 – 25 years
  • Interest Rates: Starting at 6.5%
  • Speed: As quick as 3 weeks

Restaurant Equipment Financing

With restaurant equipment financing, the lender will advance you cash to help purchase the equipment outright. You then pay back the full amount lent, plus some other expenses and fees, for a preset time frame.

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  • Maximum Loan Amount: Up to 100% of equipment value
  • Term: Expected life of equipment
  • Interest Rates: 8 – 30%
  • Speed: As quick as 2 days

Business Line of Credit

With a business line of credit, a lender gives you a credit limit, or a maximum amount of capital you’re able to draw on at any given time. Same like a credit card, you only have to pay the interest on only the amount you use.

  • Maximum Loan Amount: $10,000 to over $1 million
  • Term: 6 months to 5 years
  • Interest Rates: 7 to 25%
  • Speed: As quick as 1 day

Accounts Receivable Financing

Accounts Receivable Financing allows you to sell your invoices to a lender who will then advance you a large majority of the invoice amount, keeping a remaining percent, which is normally 20% until the invoice is fully paid.

  • Maximum Advance Amount: Approx. 50 to 90% of the total invoice amount.
  • Term: When customer pays the invoice, you receive the remaining 10-50% reserve amount, minus the fees.
  • Factor Fee: Approx. 3% + %/wk outstanding
  • Speed: As quick as 1 day

Merchant Cash Advance

Merchant cash advances are not the standard type of small business funding. With a merchant cash advance program, the lenders offer you a fixed amount of cash and you then pay off this advance with a set portion of your daily credit card sales.

  • Maximum Advance Amount: $2,500 – $250,000
  • Term: Automatically deducted each day through your merchant account
  • Factor Fee: 1.14 – 1.18
  • Time to Funding: 1 week

Small Business Startup Loan

The small business startup loan can help your new business get the capital that is direly needed to develop. Business line of credit, business credit cards and equipment financing are a traditional type of startup capital and a superb option when you have an excellent personal credit rating.

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  • Maximum Loan Amount: $150,000
  • Term: 6 months to 4 years
  • Interest Rates: 7.9 – 19.9%
  • Speed: As quick as 2 weeks

Personal Business Loan

Many don’t understand that you can really use a personal business loan. Personal business loans are especially helpful for new businesses that don’t have an long financial history to reveal lenders. Personal business loans can regularly have lower interest rates as compared to some other business loans, making it an excellent option for new businesses seeking out financing to grow.

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  • Maximum Loan Amount: $35,000
  • Term: 3 to 5 years
  • Interest Rates: 5.99 – 36% APR
  • Speed: As quick as 1 day

Bad Credit Business Loans

Bad credit is normally defined by the FICO as a score of 300 to 629. This is the reason that traditional sources like banks and credit unions reject small business loans. However, thanks to alternative lenders who provide bad credit business loans for borrowers with a pockmarked credit background. They typically concentrate more on the strength of your business as compared to your personal credit score.

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  • Maximum Loan Amount: $250,000
  • Term: 5-30 years for secured and 2-10 years for unsecured
  • Interest Rates: 8.99%
  • Speed: 2-3 days

Franchise Financing

Do you own a franchise business or are you looking to lease your new location for your existing franchise? Franchise financing can help you. With the franchise financing you can also renovate and revamp your previous location. Get the funding you need and forget the long delays.

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  • Maximum Loan Amount: Up to $5 million
  • Term: Up to 10 Years for Working Capital & Up to 25 Years for Commercial Real Estate
  • Interest Rates: 5.75% – 8.25%
  • Speed: 1 week

401K Business Funding

A 401K business funding IRA allows you to invest in yourself, and start or grow your own business with funding from your retirement savings.

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  • Maximum Loan Amount: 50% of your vested account balance
  • Term: 5 Years
  • Interest Rates: Interest rate is often set as the prime rate plus 1%.
  • Speed: One week

Restaurant Loans

Restaurant businesses generally have somewhat higher startup costs as compared to many other types of businesses and also the restaurant owners need more capital from time to time. Here comes the restaurant loan.

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  • Maximum Loan Amount: 500,000
  • Term: 1-5 years
  • Interest Rates: 6-7%
  • Speed: 3-4 days

Commercial Loans

Commercial loans are no different than any type of other loans you’d consider for your business. Basically, they are the debt-based funding agreements between a business and a lender.

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  • Maximum Loan Amount: $100,000 – $5 million
  • Term: 5-20 years
  • Interest Rates: 5-6%
  • Speed: 3-4 days

Secured Loans

A secured business loan is a financial product that requires you to put the collateral as a security for the loan you are going to borrow. This collateral can be any of your personal or business assets, depending on the originator of the loan.

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  • Maximum Loan Amount: $250,000
  • Term: 5-30 years
  • Interest Rates: 6-7%
  • Speed: 2-3 days

Unsecured Loans

An unsecured business loan has a striking advantage over a secured business loan: You don’t need to put up any collateral, such as your home, business equipment or inventory to borrow the required amount.

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  • Maximum Loan Amount: $150,000
  • Term: 2-10 years
  • Interest Rates: 14.56%
  • Speed: 4-5 days
Small Business Financing News │ Merchant Advisors | blog
Types Of Business Loans And Their Funding Criteria
Types Of Business Loans And Their Funding Criteria
Looking for funding to fund your small business? The road ahead is full of twists and turns because it does require a lot of time and research to locate the best funding program that suits your business. Due to theRead more
With numerous loan options & lenders, eligibility criteria, interest rates, and loan term can differ significantly. Let’s review some business loans option.
Merchant Advisors
Merchant Advisors