Retail loans are helpful when you want to venture into any business like real estate, or you need a boost for your startup business. Besides, retail loans can help finance various retail customer needs. Before we get into the nitty-gritty of the best loans, let’s look at some of the common reasons for acquiring retail loans:
- For business funding
- To purchase equipment or replenish your inventory
- To start your own business
- To maximize on new business opportunities
- And many other reasons.
There are tons of retail loans, which include business credit cards, short term loans, equipment loans, SBA loans, merchant cash advance, business line of credit, POS financing loans, short term retail loans, inventory financing loans among others.
Because there are tons of options to choose from, it’s true that it can be confusing to decide which small business loan will best suit you. However, each retail credit is usually intended to finance a given aspect of business needs in terms of finance or inventory. That’s why you need to know your objectives before deciding what loan matches your needs.
But what are the best retail loans you need to jump-start your business? Below are some of the best retail loans that are worth your time:
Equipment loans apply to business owners who need to make significant purchases of equipment. In most cases, these loans are used to purchase equipment with long shelf life or recycle frequency such as delivery vans or a cooler machine for dairy farmers.
However, the most important thing is that this type of retail loan is self secured. That’s to mean that equipment purchased will act as collateral. Equipment loans have an interest rate ranging between 8 and 30 percent which often depends on various factors such as borrower’s credit score as well as the equipment purchased.
For you to qualify for these loans, you must have a minimum credit score of 600 with at least two years operating as a business (most lenders prefer so), and a down payment ranging between 10-20 percent of the equipment value. Usually, the best lenders can cover up to 95 percent of the equipment cost.
In need of purchasing some bulk stock to replenish your stock for the upcoming high season? Inventory loans can help you with that. These loans can save you if you intend to purchase a large inventory.
The purchased inventory acts as the collateral to the loan by any chance you fail to pay back your lender. That means that your lending institution will take hold of the inventory to take care of the mortgage if you default in payment.
Lastly, inventory loans have terms of payment of up to 3 years and have an APR, usually ranging between 30-50 percent. However, for you to qualify for an inventory loan, your business must have been in operation for at least one year.
The Business Line of Credit Loans
If you have an unsustainable cash flow, and you need more cash to bolster your business operations, you’ll want to secure a business line of credit.
LOC is only suitable for business funding when you are down financially. Now, when you apply for a business line of credit, your lending institution will offer you a loan limit.
The advantage with the LOC loans is that you will only pay back the interest on the money you use and not the whole amount of credit you applied for initially. The best of all is that these loans take less time to process. Ideally, you can get your business funding within 1 to 3 days.
SBA loans are government-issued loans for small business owners who may not qualify for a bank loan. These loans have low-interest rates plus they can typically be used to fund any business purpose.
The government provides SBA loans through SBA approved lenders – typically banks. The APR often can be as low as 7.75% and comes bundled with flexible payment plans, most extended payment terms, and lowest down payment. This loan, however, requires collateral.
Startup Business Loan
Okay, do you want to give some life to your small business, or want to start your own business but you lack the funds? Startup business loans are the solution to your problems. Even though there may be tons of lending institutions, myinstantoffer could be your perfect match because it offers instant loans to loan seekers.
Startup loans are business loans provided to startup companies or businesses. The loan repayment period often ranges between 6 months to 4 years with an APR of about 7.9-19 percent. However, this type of loan is usually interest-free for the first 9 to 15 months.
POS Financing loans
Point of Sale System is crucial to any business; however, when you run a small business, you may have no POS system. POS systems have many advantages to retail business owners, for example, receiving payment, keeping track of inventory and providing purchase receipts.
Typically, these loans include daily repayment plans for customers who opt for PayPal or Square for example. The repayment interest can range between 8-15% with payment period up to 18 months. For small businesses, the best POS can be just a simple software installation.
Over to You
There are a variety of loans you can opt for. It would be best if you try any from the list. Just remember to take care of primary considerations like the interest rate.
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