Overview of Business Cash Advance and Small Business Loan Options For Small Business Owners and Entrepreneurs

By Daljeet S. Sidhu

Getting the right business funding is critical for business
owners to establish, renovate or expand their business. One can
have an array of choices for raising the capital necessary for
running and growing a business. However not all loans are
suitable for every business owner. The key then is to evaluate
your business situation and then approach suitable lenders. If
they are satisfied with your capability to pay back the loan,
they would be willing to lend with a set of terms and conditions
that should be acceptable to you as well.

However, you must pay attention to detail, as there are few
options at your disposal when it comes to getting a loan. The
foremost step is to take stock of your current financial
position and ask yourself few important questions before
approaching a lender.

1. You need to be sure about the amount you want for your
business. Having a business plan with the financial model will
be helpful in estimating the amount. If you are a business
start-up then it is prudent to list all expenses you think you
would incur in the initial months of your business operation.

2. Once you know the amount you actually need for your
business, outline your spending plan for the lenders. Typical
small business will use the money to hire employees, advertise,
buy equipment, buy real estate, or to pay off an outstanding
debt.

3. You also need to lay out a repayment plan. Your financial
statements and cash flow projections will come in handy to prove
that yours is a profitable business and you would be able to pay
back the loan in a timely fashion.

4. There is a possibility that you will be denied the loan.
What would you do then? You will have to accept rejection
gracefully so that you come across as a determined personality
and not be easily discouraged.

There are many avenues to get a loan. Some of them are as
follows:

Small business loans: This remains the most common way to get
funding for your business. You can get such a loan from various
sources, such as, credit unions, banks, small business
associations or even from an angel investor. To get a small
business loan you will have to furnish the business plan, your
credit history and other relevant information.

Business or Merchant cash advance: This loan is sanctioned
based on potential credit card sales and is perfect for the
small and midsized business who find it difficult to get a loan
approved from leasing companies or banks. The requirement for
this loan is a credit card processing agreement with the funding
merchant.

Unsecured business loans: Financial institutions offer such
loans without securing the borrowers asset and are provided in
many packages such as credit card debt, personal loans, credit
facilities, overdraft facilities, lines of credit and corporate
bonds. Interest rates on such loans can be in double digits if
your credit score is less than perfect.

ource: http://www.isnare.com