The great thing about long term business loans is that both banks and alternative lenders offer them. Like any long term loan, they require that you pay them back over a more extended period. Payment usually comes in monthly installments. Your business will get a fixed amount of capital, and you will have to pay it back with interest. The repayment period is usually 18 months or longer.
There is no official “industry standard” for specific terms. You’ll sometimes come across loans with repayment periods as short as one year and as long as several years. The amount you borrow, your business credit history, and other factors will affect the specifics. If you don’t have a great business credit history, you may not qualify for certain loans.
How much money could you ]get with long term business loans? SBA loans can reach up to the millions, at a maximum of $5 million. Alternative lenders can reach as high as $500,000. Unless you have excellent business credit, you will need to put up collateral. For start-ups, lenders will expect the business to have an adequate cash reserve left after their investments. You’ll need to put up proof that you’ll be off to a good start with down-payments.
Long Term Business Loans from Banks
Banks are a lot more restrictive than many online lenders. The process also takes longer with SBA-loans. With the latter, it can take several weeks to complete all documentation and other requirements, even longer for a start-up. With alternative online lenders, the application and approval process can be fast. Sometimes, almost instantaneous.
If you’re unsure that your credit score is high enough for long term business loans, the truth may surprise you. The actual SBA minimum requirement is 640. It’s not the score itself that matters, since loan providers will look into the financial history and other financial obligations.
You’ll want to look into other lending options. There are plenty of different ways for a business to get funding and financial help. You may qualify for a line of credit or merchant processing.
Whether you think long term business loans are for you, one place to start your search is with Trust Capital Funding. There are several programs available with flexible funding and repayment terms.