Capitalize with a Long Term or Short Term Business Loan

A term loan is a lump sum of capital borrowed from a lender that provides cash upfront and receives that money back through a series of smaller payments over a certain amount of time. The intervals of repayments include, daily, weekly, or monthly. Therefore, a business term loan helps business owners with large purchases thanks to the way installment loans work. This is similar to how a student loan helps a small business purchase a new location, vehicle, or even a piece of equipment that will improve your business revenue.

A short term business loan is typically taken for a period of 1-2 years and is used for more immediate needs such as working capital, inventory, or for covering short-term cash flow gaps. These loans typically have higher interest rates but are easier to qualify for and can be obtained more quickly than long-term loans.

A long term business loan is typically taken for a period of 5-10 years and is used for large investments such as purchasing equipment, real estate, or for expansion of the business. This type of loan generally has a lower interest rate and more flexible repayment terms, as the loan is spread out over a longer period of time.

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Applying For A term Loan

An alternative to the traditional, time-consuming process of applying for a loan through a single financial institution is utilizing the services of a loan aggregator such as Capitalize. By submitting one application, you have the opportunity to receive offers from a diverse network of over 50 lending partners, streamlining the loan acquisition process

Qualifications for a business term loan

Operating for 12 months in business
Three most recent bank statements
Generate $17,000 each month in gross deposits. (before expenses)

Purpose for Small Business Term Loans

Small businesses can use short term loans for the following purposes:

Working Capital: It can provide a business with the cash it needs to cover day-to-day expenses, such as payroll, rent, and bills.
Inventory: Can be used to purchase inventory for a business, especially during peak seasons or when demand is high.
Seasonal Business: Will help a business that has a seasonal revenue flow, providing the necessary cash during the slow season.
Repayment of Debt: A short-term loan can be used to repay existing debts, such as credit card balances or outstanding invoices, helping to improve the business’s cash flow.
Bridge Financing: It can be used as bridge financing, to provide the necessary funds until a long-term loan is approved or until a significant sale is made.

Term loans are a popular choice for businesses due to their favorable terms and conditions. The longer duration of the loan allows for lower interest rates, providing a cost-effective solution for businesses seeking funding.

By obtaining a term loan, businesses can preserve their operational cash flow and redirect it towards other areas of their operations or investments. Capitalize offers a streamlined process for businesses to access term loans, allowing them to make strategic financial decisions and capitalize on growth opportunities.

Additionally, the set payment structure of a term loan provides a sense of predictability and financial stability, which can be especially beneficial for businesses facing unforeseen challenges.