Collateral available for business loans includes real estate, equipment, inventory, and accounts Email Marketing List receivable. These have the advantage of offering lower interest rates, but you may lose your collateral if you can't make payments. Secured loans tend to require higher credit scores than the other options listed here, making them a better option for people with fair ratings. You can find secured business loan options with minimum credit requirements of $00. Best for: Businesses with valuable assets that can be used as collateral. Term Loans With a business term loan, you obtain a sum of money from a lender and repay it with interest on a fixed schedule. While many traditional banks and financial institutions require a credit score of at least 0, lenders with minimum credit score requirements as low as 00.
Compared to other options, such as working capital loans, you'll typically need a longer term than (closer to 0 years ), which means you may be able to get a lower interest rate. Plus, your repayments are fixed, making it easier to predict your cash flow. Best for: Need a large upfront payment and can commit to fixed repayments Businesses with loan plans. Equipment Financing Equipment financing is a type of secured loan designed for when you need to purchase new equipment but don’t have enough cash on hand. You pay a down payment and then pay for it over the life of the equipment, which is usually two to seven years. ) plus interest on the installments.