A business loan is considered short-term if the repayment period is less than 36 months. The solution to your company’s cash flow problems may lie in Short Term Business Loans from a lender on Business Finance Loans.
What Can You Use Short-Term Business Loans For?
If your company requires a financial infusion to keep up with the demands of a rapidly expanding industry, a short-term business loan may be for you. It can help you reach your full potential and help your company thrive. You can use these secured business loans for various purposes, and help you realise various goals, such as:
- Remodelling your Storefront, Garage, or Office
- Help to ensure you have enough Supplies on hand before the seasonal rush
- Making over your Company’s Image
Types Of Short-Term Business Loans
Here are a few of the secured business loans & finance options that could work for you:
Business Overdraft
If you need operating funds quickly, a business overdraft may be the best option among short-term company loans, as it allows you to take out more money than you have in your standard checking account. Overdraft charges include both interest and a fee on the total amount. Overdrafts are considered short-term loans since their duration is flexible and they must be paid back quickly.
There is often a $10,000 minimum for business overdrafts, but you will only pay interest on the funds you withdraw. Overdrafts may be secured with collateral in exchange for a reduced interest rate, or you can obtain them without collateral. While the company overdraft is active, you are also responsible for paying the standard accounting fee.
Business Line Of Credit
While an overdraft is tied directly to your checking account, a business line of credit isn’t. A business line of credit is considered a short-term business loan since, like an overdraft, you only pay interest on the money you use and have some leeway in repaying the loan.
This financing requires more stringent conditions from the lender than an overdraft facility, such as a minimum number of years in business and yearly income. Other prerequisites may include the following:
- Financial statements
- Property/equity as security
- An application
If all your documentation is in place, being approved for these short-term business loans may take as little as one or two days. Banks have more stringent rules for lines of credit than online lenders on Business Finance Loans.
Invoice Finance To Cover Short-Term Finance Needs
Companies with unpaid bills may qualify for invoice financing, a short-term business loan. Invoice financing involves a lender advancing a percentage of unpaid bills (often between 80% and 90%). The debtor pays the overdue invoice; the lender remits the remaining balance to the borrower, less accrued interest. Invoice financing is similar to other short-term company loans due to the short period between issuing an invoice and receiving payment.
Merchant Cash Advances
The typical repayment period for a merchant cash advance is less than a year, making them a short-term company loan. Lenders that provide merchant cash advances do so by anticipating that the borrower will generate revenue from credit card transactions in the future. The advance is reimbursed when customers purchase using their credit card/ EFTPOS system.
Quick application and funding are two advantages of merchant cash advances. Repayments as a proportion of revenue are less likely to affect cash flow.
Looking into your loan choices is a smart idea when searching for short-term company financing. Before committing to a financing option, read the fine print. Please read the small print carefully, as there may be hidden fees.
Why Get Secured Business Loans & Finance From Us?
Getting a loan for a small business through us has several advantages. We can connect you with over 60 trustworthy Australian lenders, all of whom will be up-front about their charges and expenses. Pick the best possible loan companies.
You can apply online in only just a few minutes, and then our state-of-the-art AI matching system will show you the best lenders for your specific situation. You can compare loan terms, interest rates and other details of loans from multiple lenders before making your choice.
