A Business Term Loan is a lump sum of capital (a specific amount) that you return over a set period of time with a fixed (or adjustable) principal and interest rate, as well as a “factor rate,” which is a fixed cost. A business term loan can be short (six to twelve months), intermediate (12 to 24 months) or 3 to 5 years. Payments are usually made on a monthly or bi-monthly basis.
Business Term Loan Info:
- Rates: Interest rates 4.5% up to Treasury index plus 1% to 2.75%.
- Loan Term: 1 to 5 years can extend to 10 years if highly qualified
- Fees: Origination Fees range from 2% to 3%
- Payments: Monthly
- Credit Score Standards: Must have excellent and deep credit history
- Processing Time: At least one week and can be up to a month depending on bank