Business loans are an opportunity for profitable financing for businesses and professionals. Therefore, it is a tool that allows professionals to build a business or develop it. It is also intended to cover expenses such as expenses related to incorporation, business purchase stock, or production equipment.
What documents are required to get the business loan?
The documents required for business loan are given by,
- Application Form: Fill out the Loan Application Form with the required details and prepare one passport-size photograph.
- Applicant’s proof of identification: Passport, PAN card, Voter ID card, driver’s license, and MAPIN (Market Participant Identification Number) card.
- Address proof: Aadhaar card, voter ID card, ration card, phone bill, lease, or electricity bill.
- Proof of Age: Passport, PAN Card, Voter ID Card
- Financial Documents: IT Returns in the Last Two Years Bank statement of the last six months and the profit and loss and balance sheet for the past two years are audited by a chartered accountant (CA).
What are the types of business loans?
Long-term loan: The term loan repayment period starts from one year. They are repaid in monthly installments. The advantage is that you can borrow more significant amounts and pay lower interest rates than short-term loans. So your monthly service fee is less.
Short-term loan: This type is usually used for short-term needs and can take up to 12 months. Moreover, the amount of credit is quite limited, starting at 100$ and going up to 100 000$. This type of loan is suitable for both businesses and individuals with temporary financial difficulties.
Lines of credit: The credit line works the same as a credit card. This means that when you set a limit, for example, 50 000$, you can use it when you want and pay a specific interest rate on the amount you earn. You will then receive and refund your own free choice if you don’t exceed your credit limit
Alternative financing: There are various non-bank forms to obtain financial backups. They include crowdfunding, rent-back, online loans, invoiced financing, etc. However, the amount you can earn is much less than what would be in a bank, and interest rates are much higher.
What are the merits of using a business loan calculator?
The benefits of using a business loan calculator are given by,
Simplify repayment: Do you have any problems calculating interest rates and loan costs? The service has a simple structure. With the help of this calculator, you can split your monthly payments and all interest in minutes. Filling out your car loan details takes less than a minute.
Real-time data: Interest rates point to change. That’s why the Consumer Financial Protection Bureau regroups data on interest rates from approved creditors across the country and makes this information accessible to everyone. This fact helps business owners plan their business correctly.
Mobile friendly: At least half of people access the Internet with a mobile phone. With an online loan calculator, you don’t even need a computer when you want to compare different loan offers. If you find the offer, you want to create bookmarks for web pages.