There Are Many Business Loan Types, How to Qualify For a Term Loan
By Space Coast Daily // November 24, 2017
read the terms and conditions carefully
A term loan, characterized as a small business loan with lots of advantages for the entrepreneurs and business owners who wish to expand their business, is quite easy to get. But still, there is a qualification criterion that you need to fulfill.
There are many business loan types, but term loans stand out. They have no hidden fees, no extra charges, everything will be told right at the start along with the easy monthly payment structure. You can know more about the term loan by visiting small business loans websites.
First time applying for term loan
The newcomers in business regime or the small business owners wishing to expand their startup don’t have to hesitate while applying for the term loan. Many businesses avail themselves of this loan and use the money to make profits by which they can easily return the structured monthly payment. The qualification criterion for the term loan is really easy. However, still, not all will fulfill the basic criterion. The basic qualification criterion requires that:
- Business owners should have a good credit score
- The business should be currently generating revenue
- You must be in operations for a certain amount of time
Some standard qualification criterion
Here is an example of a business who can get approved for a term loan:
- If a business has been in operation for the past two years and is generating a revenue of $75000 and the credit score is also maintained more than 620. Then, the business will qualify for the term loan.
- If a three- year or more old business is running with a revenue of $300,000 annually with a credit score of 680 or more will instantly get approved for the term loan.
Thus, you can match your business with these standard examples and see if you are eligible for the term loan. The rate of approval will also depend on the score and revenue. If you have got a good score with reasonable revenue, you are likely to get qualified very soon and land with a great deal.
An important tip
One thing should be taken care of very well, and that is to read the terms and conditions carefully. The traditional term loans may seem very similar to each other. But, they differ in many ways too. There can be various interest rates associated with different online lenders. Moreover, the amount of loan and payment terms can also be shorter or longer depending on the lender. You should take into account two or more quotes and compare them to get a good deal.
The term loans are different from the other short-term loans regardingpayment period. Term loans will have a higher payment period, and you cannot repay the entire amount of term loan before the due date, and in doing so, you will be penalized too. So, you have to take care of these things before availing yourself of a term loan. Otherwise, the term loans will be very good for your business.
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