INSIGHTS FROM ADSUM BUSINESS CREDIT & LOANS

To qualify for a business loan , you’ll need to meet the approval requirements of the lender. These vary, but they typically include factors such as your revenue, time in business and country of installation. Many lenders display their minimum requirements confidentiality — though meeting them doesn’t guarantee you’ll qualify for the loan. Research your financing options to see which might be the best fit.

Whether a business loan is secured or unsecured depends on the lender and the loan itself. Most traditional banks and credit companies specialize in secured loans — though some may offer unsecured loans, too. Online lenders are better known for unsecured business loans, though many offer both. With a secured loan, the borrower pledges collateral, such as property or liquid assets, in exchange for the loan. If the borrower defaults, the lender can take possession of the collateral to recoup losses on the loan. Unsecured loans don’t require collateral. This increases the risk to the lender, so interest rates for unsecured loans are typically higher than those for secured loans To provide flexibility, Adsum term loans are secured with a general lien on business assets. This can help healthy businesses secure a business loan, even if they don’t have specific collateral to offer.

A business loan can be either installment or revolving — it depends on the type of loan. A term loan, for example, is an installment business loans . A line of credit is an example of a loan that provides revolving credit. Adsum offers both installment and revolving loans. Our term loan provides lump-sum funding paid back through regular installments. Our line of credit provides revolving credit that allows you to tap available funds as you need them.

A business loan can have either a fixed or variable interest rate. A fixed rate means that the loan’s interest rate is locked for the life of the loan. A variable rate changes to reflect interest rate changes in the broader market. When researching financing options, consider whether a fixed or variable rate better meets your needs. A fixed rate loan protects you against potential increases in interest rates and ensures predictable payments. A variable rate loan offers the possibility of a lower interest rate, but there’s a chance your rate could increase, too. Because of the risk, variable rate loans typically have lower interest rates than fixed rate loans.