Business loans can provide the cash you need to purchase inventory or equipment, finance business expansion pay employees and cover other costs. Before applying, make sure you understand how dri avast software loans work and what type of documentation you’ll need to provide to your lender. Be aware of the time it takes to complete your application, as well as any fees that may be due.

Common uses of business loans

A business loan can help you pay for unexpected expenses, such as a damaged office chair, or the COVID-19 pandemic. Additionally, you may need to borrow funds to cover an unavoidable capital expenditure, for example, upgrading or replacing technology, purchasing equipment for manufacturing or renovating a retail store. Some lenders offer credit lines which allow you to borrow funds when needed and with a limit and interest only charged on the amount used.

Application requirements and eligibility requirements

To be eligible for a commercial loan, you typically need to provide complete information about your company, including the official name of the business along with the tax ID number and financial documentation. This could include business plans, proposals, and statements of profits and losses and the names and Social Security numbers of those who control 20% to 25 percent or more of your business. Some lenders require that you have been in business at least one year. Others will accept startups or do not have any time requirements.

A mentor or adviser can guide you through the process of obtaining a business loan. SCORE for instance, has an extensive network of business mentors that provide free or low-cost assistance to entrepreneurs in the early stages and small businesses. You can search for local chapters and meet with an advisor in person.