The Best Alternative Loan Options for Business Growth
When you’re ready to expand your business, you’ll have several options to choose from, some of which are better than others. It’s very important to find the right financing option for your business, so that your future growth isn’t hampered by any kind of crippling debt.
Here are some of the best options available to you so you can accomplish the business growth you’ve always wanted.
SBA 504 loans
When your small business needs to purchase equipment or commercial real estate, your best bet may be an SBA 504 loan. These types of loans are designed to aid small business owners by including long-term repayment schedules, and interest rates which are fixed below the prevailing rates. With an SBA 504 loan, you can obtain as much is $15 million, and repay it back over 10 years. It generally takes up to two months before approval can be obtained for one of these loans.
Bridge loans can be perfect for purchasing distressed properties or for refinancing necessary to overcome deterioration. Repayment terms are generally favorable with bridge loans, with borrowers paying interest only for the first 6 to 24 months. With a bridge loan, you can obtain up to $15 million and take up to two years to repay the money. It will generally take as long as six weeks to be approved for a bridge loan, and interest rates will vary between 8% and 10%.
Construction loans are ideal for the entrepreneur who’s looking to build new multi-use office space, facilities for assisted living, or possibly even a hotel franchise. Construction loans are most often taken out by established business entrepreneurs who are looking to grow their business by creating new facilities, which will then serve as income properties. It’s possible to obtain as much as $30 million via a construction loan, and repayment can take up to 24 months, with interest rates falling somewhere between 6.5% and 8.5%. Expect the approval process for a construction loan to take somewhere between two and four months.
In need of alternative lending?
Business growth is the most common reason why small businesses seek funding from alternative lenders. At Fintrus, we are committed to helping small businesses achieve their objectives by providing them with the funding necessary. Contact us to see if we can help your small business as well.