Benefits of a Small Business Loan | Huntington Coast Capital, Inc.

Benefits of a Small Business Loan | Huntington Coast Capital, Inc.

 

Business Loans

 

Perhaps a friend or colleague has advised you to take out a loan for your small business, but you’re still in doubt. After all, you may not want to burden your business with debt. However, the following reasons may convince you to consider a small business loan.

 

1. Enjoy Flexibility

Loans for small businesses have varying terms and repayment periods that can suit your business needs. You can go for a long-term loan with an extended repayment duration or a short-term loan that has to be repaid after a short time. Your choice will depend on whether the loan is for personal, business, or mixed-use. In some cases, you can even apply for many types of loans.

 

2. Liability-Free

Generally, business borrowers do not need to have collateral or a specific revenue to apply for a loan. The lack of requirements is an advantage to a small business that just started and has limited income or no assets to put up as collateral. Hence, aspiring business owners can easily enter the corporate world quickly and get their businesses running.

 

3. Retain Full Ownership

When you get financing from investors or partnerships, you must relinquish a portion of the business. Although the arrangement may be helpful initially, problems may arise as the company expands. You have to consult partners on significant decisions and how the business operates, but a loan allows you to keep full ownership of your business.

 

4. Improve Business Credit

If you repay the loan on time, you will boost your business’s credit score. A good credit score makes it easier to get more loans at favorable terms in the future. For example, companies with good credit scores tend to get lower interest rates for their loans and can easily avoid accrued interest.

 

5. Access Funds Quickly 

Business expansion requires significant capital to hire new employees and operate the business. You can choose to wait for business profits to increase before reinvesting them. However, if you have projects that should start soon, you may take out a loan. The loan allows you to buy new equipment and finance new product development before your competitors do it first.

 

6. Take Advantage of Low-Interest Rates

Lenders often provide low-interest rates on business loans to get customers. As competition in the lending business becomes stiffer, business borrowers can negotiate for the best deals. Also, business loans are likely to come with lower interest rates than any personal loan. 

 

7. Nurture Relationships With a Specific Lender

When you nurture relationships with your lender, you increase your chances of getting a loan in the future. The lender will have worked with you and knows how you handle money. The next time you go to get a loan, you can always refer back to the previous loan that you repaid on time.

 

8. Overcome Liquidity Problems

Businesses require working capital to operate effectively. However, small businesses often face challenges that make it difficult to meet utilities and payroll requirements. Since these challenging times are temporary, the business can get through the hard times with the help of a small business loan.

 

9. Refinance Debt

If your business already has a loan, the mounting debt may interfere with your ability to pay bills and sustain business operations. A small business loan can help refinance your debt and give you time to pay off any loans. The new loan may have a lower monthly payment and interest rates.

 

10. Reduce Tax Payments

Sometimes, your tax obligations may be lower if you take out a small business loan. For example, you can claim deductibles on the interest you pay on loans. The best approach is to consult a tax expert to know how taking a loan can impact your taxes.

Taking a loan for your small business is easy if you use the right lender. Huntington Coast Capital provides lending solutions for small and medium businesses that need quick cash. Contact us for more information. 

Small Business Loans In California

Small Business Loans In California

Small Business Loan Application

What is the rate for a small business loan in California? “My company is looking for an asset based loan, but we do not want to pay too much!” This is the main concern when searching for a commodity finance product such as a commercial or home mortgage. Let’s face it, if I am refinancing my home mortgage, I do not care about the customer service of the mortgage company because I expect them to competently manage my mortgage needs. Further, I would not pay more for a perceived better customer service experience. My main concern, as with all of us when shopping for a mortgage, is rate.

However, in the asset based loan world, things are much different. For example, as a business owner looking to deliver on a sizeable purchase order you have been pursuing for months, cost is not the primary concern. Availability of cash is. This is because if you fail to deliver on your first purchase order, you will likely never receive another one from the same customer. Your reputation on being able to deliver is what keeps the orders coming in.

We deal with business owners on a daily basis that are under extreme timeline and performance pressure from a customer they have been pursuing for months. Once the opportunity finally comes, they simply must deliver! They view the lending partner as an asset based loan partner versus just a pocketbook. Small business loans in California are much easier to obtain when pursuing an asset based loan versus tradition bank financing.

Our private capital sources need to earn a return that is commensurate with the risk they are taking. It is a return that will both assist the borrower in their growth goals and earn the lender enough return to justify the risk of capital. A flexible asset based loan that allows the borrower a chance to expand their top line revenue where one did not exist before through traditional financing avenues.

So, the rate discussion is obviously something that is covered, but not nearly as important as it is with commodity lending. Loan rates on asset based loans range wildly depending on the asset being financed, industry the company is in and cash flow of the company.

If your business could use a flexible small business loan in California to grow your company and meet your full potential, we would like to speak with you!

To your success!

Patrick Zazueta | Founder
Huntington Coast Capital, Inc.

Small Business Loans In California

Small Business Loans In California

Huntington Beach, CA: Running a business is challenging. You have to cover monthly expenses, manage people and inventory, satisfy customers and market and advertise your business. Unfortunately, most businesses fail within 2-3 years opening due to cash constraints. This is partially due to not being able to qualify for a small business loan.

Banks lend to small businesses, but qualifying for such loans is very difficult. You need to have a history of profitable operations, retained earnings and positive working capital. These things sound achievable, but a lot harder than they look.

Luckily, small business loans in California are available to business owners that can not qualify for traditional bank financing. Virtually any asset found on a balance sheet can be used as collateral for a loan. The assets that can secure a small business loan in California are real estate, equipment, inventory and accounts receivable. Also in this group, though not listed on the balance sheet as an asset, are purchase orders.

Working capital lines of credit and term loans are the two types of small business loans in California that are available. Term loans are for fixed assets or long term expenses (think of a loan with monthly payments like a mortgage) and working capital loans are for short term needs to cover the day-to-day operating expenditures (think of a revolving line similar to a credit card, but not as expensive).

Could your business benefit from a revolving line or term loan? We secure small business loans in California and across the country. Give us a call to learn more (844) 239-2632.