Short-term business loans are one of the most popular types of financing for small businesses. They are typically used to cover immediate expenses, such as inventory, payroll, or unexpected repairs. You will generally repay a short-term loan in 3 to 12 months; they can have either fixed or variable interest rates.
Short-term business loans are a good fit for businesses that need funding for a specific purpose but don't want to incur long-term debt. When used wisely, short-term loans can help you build your business and achieve your long-term goals.
Short-term business loans can help your business flourish if you need funds quickly and don't quite have enough cash flow.
- Help you cover unexpected expenses.
- You can take advantage of opportunities to grow your business.
- Easier to qualify for than traditional bank loans.
- Shorter repayment terms than long-term loans.
- Quick access to funds - helps cash flow.
- Wide range of options to choose from.
- Lower interest rates.
Short-term loans tend to be reasonably flexible. If you get the funds and find that you no longer need them over the agreed period, you have the option to repay early. Similarly, if you need to extend the repayments, most lenders will allow you to do so.
There are a few reasons why a business would choose a short-term loan over a longer-term loan. First, short-term loans can be easier to qualify for than traditional bank loans. Your business' revenue will generally determine the rate you get rather than your personal credit score.
Additionally, short-term loans have shorter repayment terms than long-term loans, meaning you will not be making payments for as long.
Short-term loans suit businesses that need quick access to cash. They tend to have eased lending requirements and are easier to qualify for than a long-term loan, making the process simpler and faster.
A short-term business loan can help your business when you need quick access to funding.
One thing to note is that a short-term loan is not the same as a payday loan - even if payday loans are a type of short-term funding. Payday loans tend to last 30 days; you pay the lender back when your employer pays you; short-term loans are paid off over several months. Payday loans take advantage of the borrower - charging very high-interest rates and not checking whether you have the means to repay.
The type of short-term funding that we offer at Love Finance helps you bridge the gap between customer payments, bills and periods of low cash flow. They are safe to use, and we will not put any of your assets or property at risk if you can't pay.
If you're interested in getting a short-term business loan, there are a few things you can do to increase your chances of approval:
- Check your personal credit score and fix any errors.
- Put together a strong business plan that outlines your revenue and expenses.
- Compare offers from a range of lenders to get the best interest rate and fees.
Do your research on how to get a short-term business loan to ensure you get the best rates and terms.
You can use our business loan calculator to determine how much your repayments will be based on how long you have the loan over.
If you're not interested in getting a short-term business loan, there are a few alternatives to consider.
You could look into using a personal loan for your business expenses. However, it's important to remember that personal loans typically have higher interest rates than business loans, so you should only use this as a last resort. Additionally, some lenders may restrict what you use your loan for, meaning that you cannot use a personal loan for business expenses.
Generally, it makes the most sense to get a business loan if you are going to use it for business purposes. The lender and broker will be familiar with business finance, meaning they can provide you professional advice along the way.
There are alternative funding options for a short-term loan but a business loan is your best bet if you are using the funds for developments within your business.
No matter what financing you pursue, you should evaluate your funding needs and ensure you will use the cash effectively. Taking these measures ensures you get the best possible loan for your business. As long as you remain aware of your financial situation and the potential risks of short-term loans, you can use the funds to your advantage.
A merchant cash advance is a type of short-term funding. If your business makes £2k+ in card sales in a month, you could be eligible for this type of business loan. The benefit of a merchant cash advance is that you only repay when you make a sale, and with Love Finance you can borrow up to £250,000.
If you're considering taking out a short-term loan for your business, comparing different offers from lenders is beneficial. Before deciding on a loan, consider the interest rate, fees, and repayment terms. You can also talk to your accountant or financial advisor to get their opinion on whether a short-term loan is appropriate for your business.
Contact us if you have any questions regarding short-term business loans. Whether you need the money to keep up with VAT payments, business expansion, inventory purchases, or to pay your employees, we will d our best to find you the appropriate deal.
Fill in our short, online form and you could have the funds in your account within 4 short hours.
