Questions Small Business Owners Have About Small Business Loans
Small Business Loans – Three Questions Small Business Owners Have
Small business owners are always looking for sources of funding in order to expand their businesses. They usually have a few questions about obtaining small business loans and the following discussion answers the three most common questions asked.
Where can we Obtain Small Business Loans?
Applying for small business loans from traditional lenders is a very time-consuming, process. According to a study by former US Small Business Administrator, Karen Mills, small business owners approach at least three traditional lenders and spend as much as twenty-six hours searching for small business loans. Unfortunately, after all this time spent, approximately only one in ten small business owners manage to procure a loan. Fortunately, alternative lenders have jumped in to fill the breach and make it easier to get small business loans.
How Much Money Can I Obtain?
Several factors are examined to determine if small business owners qualify for small business loans – length of time in business, monthly business revenue, credit score, profitability, number of credit card transactions, home equity. A lender will take all of these benchmarks into consideration to determine the amount of loan you are able to qualify for.
How Much do Small Business Loans Cost?
Even if you qualify, term loans with low interest rates from conventional sources such as banks take from several weeks to two months or more to process. However, you may need money in a hurry, and you need to consider whether the opportunity to grow your business outweighs the cost of funding from an alternative lender. Obviously, for companies with risky profiles, interest rates on small business loans from alternative lenders will be higher and the repayment periods will be shorter than if your business is more secure.
Even when small business loans come with high prices, investing when companies need the capital can enable those businesses to succeed. Vantage makes the process of obtaining small business loans easy to understand, so talk to us today to see how we can smooth your path to effective financing.