Business Loans for Your Small Business

Gone are the days where business owners were dependent almost entirely on banks or loans from friends and relatives. Today, there are many different sources available for business loans.

Loans typically come in three primary forms.

• Short-term business loans provide capital for a business in need of cash to start operations. These loans are generally for one year or less.
• Intermediate term loans can help start-up businesses pay for equipment and cover large initial expenses. Such loans are usually for anywhere from one to three years.
• Long-term loans are often used to assist start-up businesses with initial costs such as equipment, furniture fixtures and commercial mortgages. Such loans are generally from three to seven years and repayment is typically made in installments.

Before approaching a lender it is important that you have a clear understanding of what the loan will be used for and how you can best present such information. It is equally important that you have a realistic plan for repaying the loan.

When working on a loan request, you want to include the following, some of which will likely be included in your business plan.

• The purpose of the loan
• Specifically how much money will be needed
• A management profile
• An overview of the market including your projected customer base and competition
• Personal and business financial statements and if possible, collateral that can secure the loan