Small businesses are a huge part of our world, taking many different forms and functions. However, sometimes running a small business means taking out an advanced financial loan to keep your venture afloat.
We highlight six such loans for your small business and explain how to get them.
1. Working capital loan
Your business requires a reliable source of working capital to remain profitable. A working capital loan is a loan you take to finance daily business operations. Rather than purchasing long-term assets for your business, a working capital loan covers costs associated with everyday running costs.
Lenders like AdvancePoint offer working capital loans to supplement cash flow issues. Small businesses can leverage a working capital loan to cover operational costs such as office rent, wages, and utility costs.
2. SBA loans
Funding helps you meet expenses and fund new growth opportunities. The Small Business Administration (SBA) guarantees loans made by banks to small businesses. SBA helps small business owners obtain the financing they need while extending their commercial capital.
An SBA loan for a small business is worth considering if you cannot get funding from a traditional lender because of your company's size. SBA loans offer exceptional flexibility with lower down payments and zero collateral needed.
3. Equipment Financing
Your business must purchase equipment for manufacturing, processing, or other necessary work. When purchasing machinery and equipment, the business owner faces high upfront costs with little capital to pay for them.
Unlike a working capital loan, the primary purpose of equipment financing is to finance the purchase of capital equipment. The gear can include machinery, parts and supplies, computers, office furniture, and more.
4. Franchise loans
Businesses thrive when franchises are established and expanded. Franchises provide customers with a company's brand name, supply them with the products they want, and provide employees with the opportunities to reach new heights of success.
However, franchisors require upfront capital to set up their business venture. Franchise loans help franchise owners acquire the money they need to cover the cost of setting up a franchise in a new location.
5. Commercial mortgage
Small businesses may require additional real estate for their operations. Commercial mortgages finance commercial real estate purchases by small business owners.
Your commercial mortgage helps you buy or refinance real estate properties like retail stores, office spaces, or warehouses.
6. Lines of credit
A business line of credit is competent to a revolving credit account. The account holder has access to funds through an established line of credit at their disposal. However, they may not be required to draw the total amount at any given time.
Small businesses are enormous contributors to the economy. However, running a business requires you to invest your funds and business profits to ensure your venture succeeds.
A small business loan can be the key for your company when you need funding for equipment, real estate, or operating costs. Take time to find out about the options available and find a company that will give you an offer that suits your needs and helps you succeed in your venture.