Finding financing for your business shouldn't be hard
After the recession of 2008, the government rescued the big banks under a (very simplified) condition: that the banks implement much stricter risk controls.
As a result, bank loans to small businesses declined, leaving many small businesses without knowing where to get the funds they needed.
It was not long before the online business financing companies began to appear, trying to meet the need for working capital.
Today there are more options for small business owners looking for an online loan. However, the misconception is that these online small business lenders are only offering incredibly expensive business loans, which is not necessarily the case in general.
There are many online lenders where business owners can find affordable rates. At LendrzHub, we like to call them "medium term" lenders.
Meet the lenders of small companies in the medium term
When we talk about "medium term" commercial lenders, we usually talk about online private lenders that offer products that have times of more than one year. (That means you have more than a year to repay the loan). In most cases, your loans also have monthly payments.
Besides, many of these rates from lenders start at ~ 6%, which is not much higher than a bank product. That said, qualifying for such a low price can be difficult, so it is essential to know that the rates of a product in the medium term can also affect adolescents.
In summary, medium-term commercial lenders offer a traditional term loan with which you are familiar: a loan with terms that exceed the year and that you pay with a fixed monthly payment. Structured as a banking product, but the applications are more efficient than banks, and the rates can be slightly higher.
When people think of online loans, the product that most likely comes to mind is a short-term loan. These are the most common loans found online. Although short-term loans come in all shapes and sizes, in general terms, they are loans from 3 months to 18 months that paid every business day.
Due to their shorter terms, they tend to adapt to people who need capital quickly. The applications for these products only require three months of commercial bank statements are required.
The only thing that you should keep in mind when it comes to short-term loans is that they can be costly. Rapid capital can be an expensive capital, and you must remember that when you are comparing it.
Also, many short-term loan lenders tend to cite their rate as a "factorial rate." It is crucial that you convert any quoted factor rate to APR using a calculator so that you understand the cost of talking more about factor rates later on). Also, make sure you know how the advance payment of the loan works, in case you have plans to pay off your debt ahead of time. Sometimes, the advance payment can be a little complicated with short-term lenders.
LendrzHub can help.
Being denied a loan does not mean the end of the world. It just means that you probably have to look elsewhere, somewhere where your business is worthy of credit. With over one hundred lending partners, we can help get you the money that your business needs and deserves.
Visit us for a fast, no-compromise pre-approval.