Loans

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3 Types of Small Business Loans for Entrepreneurs Who Need Cash Quickly

October 20, 2018 - 10:30 am
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Small business entrepreneurs often have limited time and little seed money to start or keep their enterprise running. Fortunately, extra cash may be available through a quick cash loan.

 

Working capital loans

Swiftly funded loans are available, which can be distributed as fast as overnight. If you require this funding to be infused into your new venture in order to get it going, then taking out a working capital loan may be the answer. This kind of loan is typically called in for terms that mean you'll have limited months to repay. Interest rates widely vary, with a whopping 99 percent on the high end. Obviously, this cost can be prohibitive so be sure to actively scrutinize the deal before any money changes hands.

 

Business lines of credit

Activating a line of credit can turn out to be the fastest way to get funded. This is especially helpful should you need funds as quickly as possible. In this instance, you can receive as much cash as you need as long as that amount of cash does not exceed your credit limit. This money could be available to you as soon as the next business day. The optimal way to use this kind of loan is to pay back as much as you can, as fast as you can. Treat the loan just as you would should you borrow from a credit card with extremely high interest rates. Also, remember that your lending institution can lower or take away this privilege at will.

 

Short-term loans

Short-term loans are another option, which often can be processed in as fast as 48 hours, but can also be very expensive for the borrower. While repayment is expected in a matter of months, the interest you end up paying may be as high as a cash advance from a high interest credit card. However, taking out this sort of loan might be your only option. For instance, if your business can longer operate due to a failure or break in the system, such as a broken office printer, then a short-term loan might be your best answer. After all, extended down time is the last thing your business needs in order to thrive.

 

Finally, keep in mind that all fast-funded loans are subject to intense scrutiny on the business owner's part. If collateral is expected in return for a particular loan, you need to think long and hard before getting into what could be a very bad situation. Doing due diligence when it comes to borrowing money is always, in the end, the best advice you can take.

 

 

This article was written by Jane Lasky for Small Business Pulse