Saturday, May 26, 2012

Unique Kinds of Commercial Loans

There are actually a lot of various types of commercial loans that interested borrowers can choose from. Whenever you need extra funds for your business, your first step should be to meet with a commercial lender.

Here are some examples of commercial loans businesses may utilize:

Secured - Working Capital Loans
This kind of commercial loan is great for companies who are seeking to convert the business or the personal assets of the owners into working capital. With this sort of commercial loan, the company will probably be giving the commercial lender security in the form of an asset or assets in exchange for money.

Unsecured - Working Capital Loan
This sort of commercial loan for a business' working capital needs are unsecured and is purely according to the credit worthiness of the applicant, and within the case of a commercial or business loan, the creditworthiness of the business owner.

Commercial Real Estate Loans
This sort of commercial loan is for real estate acquisition, refinances, or construction, and normally comes with a fixed term over a longer amortization, sometimes as long as twenty-five years, or may also use variable terms and interest rates.

Accounts Receivable Factoring
With this type of commercial loan the borrowers Accounts Receivable serve as collateral for the short-term working capital loan. This type of commercial loan can be acquired quick and cost effectively.

Merchant Account Cash Advance
Up to a ,000 advance against regular occurring monthly merchant credit receipts, which give for simple and quick working capital but requires assigning those credit card receipts to the lender and usually comes with higher interest rates.

Start-up Loans
This kind of commercial loan is particularly for start-up companies, and is typically funded utilizing a combination of company assets and personal assets as collateral.

Franchise Start-up Loan
Specialized financing reserved for recognized franchises, usually nationally known, franchises, that are usually times short-term in nature and with slightly higher interest rates because of the start-up risk related to new franchise businesses.

Company Acquisitions
This type of commercial loan is usually used by company owners or other companies to be able to acquire or buy out an existing company. Loan terms are usually kept tight and are based off of the cash-flow of the company being purchased.

Lines of Credit
This type of commercial loan or credit facility has a pre-arranged quantity of credit based on existing inventory, Accounts Receivables and Purchase Orders. The loan is usually secured by the business assets pledged as collateral.

Professional Loans
This sort of commercial loan is specially designed or packaged for professionals like Medical Practitioners or Doctors, Lawyers, Dentists, Certified Public Accountants, Engineers, and other people. These loans are usually tied to the certain company assets of each sort of business, and usually provide flexible repayment plans to match the unique cash-flows of each business type.

Equipment Financing
This type of commercial loan is created particularly for funding needs of a company to buy equipment. The equipment purchased is then used as collateral for the loan.

Equipment Leasing
An easy method of sourcing the financing for equipment needs. This is also great because tax benefits can be claimed at the same time.

Business Only Loans
This type of loan can be obtained using only the business name (with out the use of personal credit of the company owner as long as the company can validate the loan amount and can show sufficient proof of its capability to pay back the loan amount.

Construction Financing
This kind of commercial loan is for home construction or commercial building construction.

Hard Money Equity Loans
This kind of commercial loan typically comes from a private money lender and is generally offered at a greater interest rates for commercial loan kinds which are harder to obtain bank financing for.

Multi-Family Real Estate Loans
This kind of commercial loan is designed for real estate investors who are looking for financing for multi-family residential investment properties they own. Due to the long-life of most residential investment properties, these loans usually take pleasure in longer terms with fixed interest rates and longer amortizations, and the loan amount is based off of the amount of cash-flow the property produces to service debt.

As can be seen you can find a multitude of different commercial loan alternatives offered for commercial borrowers and companies. Acquiring the commercial loan type that best fits your needs starts having a conversation with your commercial lender, who can guide you to the best item and help get your loan done.

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