Financing a small business is often the biggest hurdle to cross before even opening the doors. There are many different competitive choices out there in the world of small business alternative lending. But it’s important to be careful about who you decide to go with. There are a lot of less-than-reputable financers out there that just want to keep you paying for as long as possible.
Basement lenders and sharks are dangerous for two main reasons: high interest rates and extended repayment terms. These conditions make it virtually impossible to pay down the principal amount borrowed, with your payments instead going directly to interest and are steered clear of the bottom line
Instead of throwing your money away for what can add up to years at a time, focus on getting the financing you need from a reputable lender. The best lenders in the industry offer lower interest rates and repayment terms of six to twelve months. There’s simply no reason to settle for financing that doesn’t work in your favour. Call today to learn more!
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In the world of small business alternative lending, there are a few
things to keep in mind to avoid becoming trapped in debt for years. Understanding
how lenders earn income and knowing what to look for in a lender can help save
tens of thousands of dollars.
Bad Lenders
It’s not uncommon to hear stories about alternative lenders that bait
victims with the promise of low payments to be made at the discretion of the
borrower. Those scenarios are created by the lender to keep a business in debt
as long as possible. The longer you’re paying interest and not the principal,
the longer you’ll be paying, and the longer the lender generates income. Avoid
this at all costs! The goal is to generate income for yourself, not for someone
else.
Good Lenders
The most reputable alternative lenders operate differently. While they
still earn income from interest, they limit the amount that can be made from
each client by creating more realistic repayment terms of six to twelve months.
By doing this, they create a definitive end date, at which point the borrower
is free from financial obligations to the lender.
Alternative lending can be an excellent way to help an entrepreneur
reach their goals. Just be careful about who you choose to borrow from. Contact
only the most dependable lender in your area to learn more about the products
and services that best suit the unique needs of your business today!