Best Small Business Loans to Apply For In 2021

    Article Overview

    Business and risk may look like two altered words but are the different sides of the same coin. Investing your savings in starting a business is never a good call and there are many reasons why. To start with, think about what happens if the business does not do well in the market as you anticipated and you start incurring losses from it? This will be the worst nightmare come true but again this will leave you with a no-income source and no savings. When you take a loan or start the business with a partial partnership, you will be risking less at stake here. However, when you take a business loan you will be responsible for paying the debt even if the business fails but this is a much better option and so people opt to apply for a business loan when they start their own business. Ensure your savings can cover your monthly loan repayments for at least 12 months. This will give you time to find asolution if anything does go wrong. It will keep debt collectors like Online in sv and NRC collection agency at bay or at the very least afford you time to negotiate with the debt collectors.

    When it comes to applying for a loan, there are two options. Either you can apply for this from traditional lenders like banks or credit unions, or you can opt for a loan from online lenders. How to determine which to choose depends on a few criteria and they are borrower requirements, loan amount requirement, and types of financing offered, rates, and funding times.

    Let us look at the below Venn diagram to understand this. Here, Region A represents the borrower’s requirement. Suppose Region A represents that the borrower is looking for a lender to lend $250,000 and also some other conditions that fall in this category like the span of years you have been in the market or other such factors. Now, Region B represents the Lender’s requirement. So let us assume that the lender has a few conditions and one of them is that the company that the lender will lend to needs to be at least three years old in the market. And you have been in the market for only one year then many such lenders are canceled. So what remains in Region C is the union of A and B which are the favorable outcomes for both. Hence after looking at the borrower’s requirement one will automatically cross out a few lenders.

    types of financing offered

    Similarly, the factors like types of financing offered, the amount of the loan rates, and much more come into the scene to help you figure out what to choose and what not. Let us look at the below top lenders of 2021 to understand the needs and requirements more:

    • Lendio: It is a Utah-based lending company that was founded in 2011. This is the best one can go for because as much as this is a lending app, this is also the lender’s and borrowers’ matchmaker. All one needs to do is fill out a questionnaire with a few basic requirement questions. The app will then use these details to look for lenders for your business. In almost 72 hours it will bring you a few results and you can go ahead with it after that. Lendio has got about more than 70 lenders on their site and a borrower can easily be matched with the one that perfectly fits their requirement. 

    lendio

    • Funding Circle: Funding Circle is a peer-to-peer lending company which means it is a direct form of lending between the lender and the borrower without the interference of any third party working as an intermediary. Which translates to something similar to the other two above. But there are a few limitations to this one and that is, there are fewer options available in this platform and they only lend and interact with well-established ventures. It is one of those P2P with strict borrower requirements and one of those is that the borrower must have a credit score of 660 and above. It is an affordable funding opportunity given the fact that you can apply for the same. In short, if you can get it it is one of the best in the market for you. 

    funding circle

    • Fundera by Nerdwallet: Fundera is a lot similar to Lendio and the only difference is that they have more options than Lendio and other P2P. They have SBA microloans which are government-backed loans. There are many benefits of opting for an SBA microloan and some of them include lower interest rates, long terms repayment plans, etc. Fundera has a satisfied customer base and with a credit score as good as 550 and above Fundera can be your wonderland when it comes to getting funds for your business.

    Fundera by Nerdwallet

    • BlueVine: BluVine is a California-based fintech company that also deals with online transactions and business banking. If your loan requirement is urgent plus 72 hours is too long for you to wait then BlueVine is where you go to. And of course, everything has its pros and cons and we will definitely get into that. But the bottom line here is it will provide you with same-day funding and will offer a fast transaction like no other platform. However, like the other platforms, you will most certainly need to fill out a few questionnaires, and in a couple of hours if not instantly they decide on the loan.

    BlueVine

    • Fundbox: Fundbox is a San Francisco-based financial company which deals in offering credits and loans to young and budding businesses. They have been known to work with young companies and startups. If your business is also a budding one and too young to qualify the other platforms for loan approval, you can knock at the doors of Fundbox. They only require a company to be around in the market for at least six months that is the minimum requirement for them. However, they expect your credit score to be around 600 and a pretty decent annual revenue that is $100,000.

    Fundbox

    The above was just an introduction to these platforms, when one needs to borrow for a business one is required to understand a few things point to point for the company. They are comparing between the platforms the type of loan offer, the rate of interest being offered, the repayment period, fees, and other such factors. A detailed study of the market is a must before taking the call. 


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