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Business Loan and Funding Comparison Guide
The lowest advertised rate is not always the lowest-cost or best-fitting option. Compare the payment structure, total repayment, collateral, guarantees, fees, flexibility, and consequences of a missed payment.
Use this guide with current business records and written provider disclosures. Requirements vary, and no checklist can determine approval.
Common structures and practical uses
- Term loan: a defined amount repaid over a defined term; often used for projects with a measurable budget and expected return.
- Business line of credit: revolving access up to a limit; often considered for recurring or unpredictable short-term needs.
- Equipment financing: funding connected to identified equipment, which may serve as collateral.
- SBA-backed loan: financing issued by participating lenders with an SBA guaranty, subject to program and lender requirements.
- Commercial real-estate financing: longer-term funding tied to an owner-occupied or investment property and detailed property review.
- Invoice or receivables financing: capital linked to eligible unpaid invoices, with cost and customer-notification considerations.
- Revenue-based product: payments may be tied to sales or collected frequently; owners should calculate total cost carefully.
Use the same comparison fields for every offer
- Net proceeds received after all withheld fees.
- Total dollars expected to be repaid.
- Payment amount, frequency, first payment date, and maturity date.
- Interest rate, factor rate, variable-rate index, and every fee.
- Personal guarantee, collateral, lien, and default provisions.
- Prepayment penalty, prepayment discount, renewal terms, and servicing contact.
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