Long-term business loans are the preferred option for many. They enable the borrower to make the loan repayment over a longer period, but this results in higher amounts lost on interests. For how long can you get a small business?
Repayment Terms for Small Business Loans
What’s the most usual answer to “how long can you get a business loan for”? Well, the majority of long-term business loans require borrowers to make payments during one – five years. With SBA, loan terms can be up to 25 years.
Overall, there is more than one nuance associated with loan terms. Overall, the repayment period is determined based on:
- The loan providers terms and guidelines
- What type of lender you’re applying to
- The loan program you’ve chosen
- What you’re going to use your loan for
- The financial profile of your business
- The business funding repayment period
If you’re a well-qualified borrower and have an established track record, you can negotiate more favorable terms.
When it comes to the maximum amount you can borrow, the majority of lenders are upfront about that. Sometimes, you can read this information on their website, like “loan amounts up to $500,000” or “up to $1 million.”
Small Business Loan Terms From Alternative Lenders
The longer you have to make your monthly payments, the lower amount you’ll be charged. However, the longer you pay, the more you’ll lose on interests over time. As a result, you’ll have a difficult time making a positive return on investment (ROI) for the funds you borrowed.
Alternative lenders typically offer short-term loans. You can obtain alternative business funding more quickly as compared to traditional ones. Besides, alternative lenders are great for those who’ve been rejected by traditional financial institutions.
In this case, the financing options feature short repayment periods. For example, you may be offered a 6 – 18 months term. However, you can also apply to alternative lenders for long-term loans with repayment periods of 2— 5 years.
Only, when applying for business financing from an alternative lender, make sure it’s a reputable company offering secure and low-cost funding solutions. Consider working with First American Merchant, a BBB-accredited alternative online lender in the high-risk field.
FAM offers the cheapest possible rates for a business loan in both low and high-risk industries. FAM is also an award-winning merchant processor offering the most secure and advanced payment processing services in the space.
How Long Can Your Business Loan Be?
With traditional lenders, you can apply for a longer-term. Alternative lenders offer shorter repayment periods. Work with a respected alternative online lender for the quickest access to the funds you need for your business.