Tips for Short-Term Loans for Growing Businesses
Growing business can require a diverse range of financing to compete with more established companies. A key financing area is short-term funding. Discover how short-term loans can propel your business forward and help you achieve sustained business growth.
From small businesses to major corporations, businesses at every level need short-term financing for specific needs. Whether you’ve experienced a sudden breakdown of essential equipment, you need additional inventory to complete a large order or you’ve discovered an excellent short-term investment opportunity, these loans can help your business in a variety of ways.
Most short-term loans are far more responsive than long-term options. Instead of waiting months for approval, you can often receive your short-term loan in as little as 24 hours. Many short-term loan options also allow lower credit score applicants or even offer no credit check.
Of course, this means that short-term lending typically comes with higher interest rates and shorter terms. If your short-term investment opportunity becomes a long-term investment, you’ll need to find a new funding strategy.
To apply for a short-term loan, you’ll typically need an asset to offer as security. Due to the higher risk of short-term lending, most providers ask for a piece of real estate, equipment, inventory or even invoice to back your loan. If your investment doesn’t work out or if you aren’t able to make payments on your loan, your lender will seize the asset as repayment.
Just like long-term lending, don’t be afraid to discuss payment plans or shop around for the best terms. Each loan comes with slightly different rates and terms, so you’ll need to work with your lender to find the loan option that works for your unique situation.
Invest in your real estate using a short-term loan. A popular business strategy is to use your loan to purchase necessary renovations, then refinance your commercial real estate to secure a better rate and pay off your loan. This added value on your commercial property is an excellent way to invest in real estate while enjoying improved functionality at your office or storefront.
Short-term loans are dynamic, personalized and flexible enough to provide financing for a wide array of business opportunities. Whether you’ve been denied a long-term loan or you need fast funding this week, consider choosing a short-term loan. Keep your business moving forward by paying your bills on time, purchasing necessary equipment and handling any crisis that may come your way.