There are various advantages and disadvantages of business loans. Lets look into it more closely to help you understand what suits you best. After all if you are getting married to your business, you ought to know know more about your wife, Right?
You must remember that there are people out there who are ready to fund business loan with you if you have a good credit score of 720 and up, a decent business plan and a stable income. What you must find out is if the business loans suit your business. There are multiple loan options in today’s market to finance your business. From the traditional lenders such as banks to alternate lenders such as angel funding, entrepreneurs are truly spoil for choice. Based on different types of requirements such as time period, size of business, interest rates etc. you are sure to find your perfect lender.
Again through the traditional lending option such as bank, you have more control of your business as compared to the alternate lending options such as venture capitalists and angel funding. Normally banks are interested only to the loan that you repay them back with the agreed interest. But venture capitalists or angle investors agree to pay the loan in share of profits, decision making and ownership of your business. Again getting loans from the banks can be cumbersome and lengthy. They not only verify your credentials and your business before granting you a loan but also look into your credit score, your credit history, your financial strength and other details, which frankly speaking takes quite a time as compared to angel funding or investors. They provide you loan in a greater amount based on your business plan and opportunity your business throws up in the future. They are more concerned about the profits your business is poised to bring in for them. There are also early repayment options without penalty in some loans, Bank loans provide tax benefits to the borrowers because the percentage that is used to repay loans from the profits are done away with. Traditional lenders have a competitive lower interest rates then others putting them on the top list of options for people looking for funding. Banks do have a long list of qualifications that one must qualify for a business loan and again they may not fund 100% of your business. Now that’s some headache!