If you are running a small business, you may have taken more than one loan to manage cash flow problems or buy new inventory. Running a business involves investing your time and money to make it succeed. Paying loans one by one can be hectic and stressful. That is why you need to consider small business consolidation loans.
Various providers offer this type of loan to entrepreneurs to help them manage their finances more effectively. You have to compare the available options so that you choose the one that is ideal for your business. Once you have done your homework, it becomes easy for you to make smart financial decisions. The option that you go for depends on your business situation. Here are some of consolidation loan providers available.
You can use a bank loan to consolidate your debts. Loans that come from banks are known to have low-interest rates and reasonable repayment terms. You can acquire a substantial loan amount to consolidate your debt. Banks offer consolidation loans with less than 10% interest. You have to pay back this loan monthly.
You can choose to borrow from the national bank or local community bank. For you to qualify for this loan, your business should be more than a year old and have steady revenue streams. The lender has to confirm your creditworthiness before approving this loan.
The small business administration also offers consolidation loans to entrepreneurs. This is a government-guaranteed loan that is quite affordable. It is also easy to qualify for an SBA consolidation loan than a bank loan. You may get up to 25 years for you to repay this loan. The interest rates are also friendly beginning at 6.75%.
For you to be eligible for an SBA loan, you must prove that your business finances are stable. You also need strong credit to increase your chances of getting approved for the loan. If your score and that of your business are not high enough, take some time to improve them.
This is an online lender that also offers consolidation loans to business owners. Fundation provides up to $ 350,000 to help you consolidate your debt. If you have the means, you can ask the lender to let you make payments after every two weeks. The interest rates are a bit higher than the other options but paying it after two weeks can help you clear off the loan within four years. Most people find the rates more affordable than what short terms loans offer. You can easily qualify for this consolidation loan as long as your business has positive revenue.
Feel free to apply for this consolidation loan online. Funding Circle can give you up to $500,000 to help you clear off multiple small debts. You have to pay this amount within five years. Apart from the principal, the loan comes with interest rates which are not very friendly. It is a bit hard for one to qualify for a consolidation loan from this lender.