Financing FAQs

We help business owners explore financing options and connect with prospective lenders. We discuss your goals and help coordinate the next steps. The lender makes the credit decision and sets the financing terms.

Start with your purpose, funding amount, timeline, cash flow, and available collateral. A specific purchase, recurring operating need, and real estate project may call for different structures. Contact us to discuss your situation.

Useful starting documents include business bank statements, financial statements, ownership information, and details about existing debt. A lender may also request tax returns, equipment quotes, property information, or collateral reports.

Timing depends on the lender, product, documentation, underwriting, and closing requirements. Tell us about your deadline early so we can help clarify the expected process. Approval and funding are not guaranteed.

Lenders may review business and personal credit. Before authorizing an application or credit inquiry, ask whether the inquiry is a hard or soft pull, whose credit will be reviewed, and whether multiple lenders may make inquiries.

Review the total cost, payment schedule, interest and fees, collateral, guarantees, prepayment provisions, and default terms. Ask for written explanations of anything unclear and consider how repayment will affect your cash flow.

Depending on the program, business loans may support expansion, inventory, equipment, hiring, or other approved business purposes. Confirm permitted uses with the lender before committing.

A term loan generally provides a lump sum with repayment over an agreed period. Payment frequency, rate structure, amortization, and any balloon payment depend on the agreement.

Some lenders consider newer businesses, while others require an operating history. Eligibility may depend on revenue, owner experience, credit, collateral, and the business plan.

Hard money financing is generally a short-term, property-secured option used for business-purpose real estate investments. Lenders place significant emphasis on the property, while also evaluating the borrower and project.

No. A lender may also consider borrower experience, credit, cash reserves, down payment, renovation plans, and the proposed exit strategy. A valuable property alone does not guarantee approval.

It is your plan to repay the loan, such as selling the property or obtaining replacement financing. Review maturity dates, extension costs, and contingencies. Refinancing or a property sale is not guaranteed.

A revolving line allows draws up to available credit, subject to lender terms. Repayment may restore borrowing availability during the draw period, provided the facility remains open and in good standing.

Interest is generally based on the amount borrowed, but other costs may apply. Review draw fees, maintenance charges, unused-line fees, minimum charges, and the lender’s interest calculation.

Access depends on the agreement. Renewal, collateral values, covenants, and lender review can affect availability. Understand the draw period and circumstances in which access may be reduced or suspended.

CRE stands for commercial real estate. Financing may support eligible business premises or investment properties, such as offices, retail buildings, industrial facilities, or multifamily properties, depending on the lender.

Lenders may review property income, leases, occupancy, expenses, appraisal results, borrower finances, and environmental conditions. Owner-occupied and investment property requests can have different requirements.

A balloon is a larger balance due at maturity when regular payments do not fully repay the loan. Check whether an offer includes one and plan for it without assuming future refinancing will be available.

Depending on the agreement, eligible costs may include materials, labor, permits, site work, and other approved development expenses. Lenders review the project budget, plans, builder qualifications, and contingency funding.

Funds are commonly disbursed through staged draws as work progresses. Inspections, invoices, lien waivers, and other conditions may be required before a draw is released.

Not necessarily. Some products include a conversion structure, while others require separate refinancing or repayment at maturity. Conversion conditions and any replacement financing must be reviewed in advance.

No. SBA-backed loans must be repaid. For programs such as 7(a), participating lenders make loans with an SBA guarantee covering part of the lender’s risk. The guarantee does not remove the borrower’s repayment obligation.

Uses depend on the program. The 7(a) program can support eligible working capital, equipment, and real estate needs. The 504 program focuses on eligible major fixed assets and cannot fund working capital or inventory.

No. Applicants must meet the relevant program rules and lender underwriting requirements. Eligibility, documentation, down payment, guarantees, and terms depend on the program and request.

Factoring generally involves selling eligible invoices to a factor. Accounts receivable financing uses eligible invoices as collateral for borrowing. Collection arrangements, fees, and obligations depend on the agreement.

Providers may evaluate invoice age, customer credit quality, payment history, disputes, customer concentration, and evidence that goods or services were delivered. Overdue or disputed invoices may be excluded.

Your responsibility depends on recourse provisions and any specific nonrecourse coverage. Even a nonrecourse agreement can exclude disputes or other events. Ask which losses are covered and when you must repay or replace an invoice.

Eligible receivables and inventory are common forms of collateral. Some arrangements also include equipment or other assets. Acceptance depends on lender valuation, asset quality, ownership, and existing liens.

It is a calculation of how much a lender will advance against eligible collateral using agreed advance rates. Available borrowing is also limited by the facility commitment and other terms.

Yes. Collections, inventory levels, collateral values, and eligibility can change availability. Lenders may require updated reports, field examinations, or appraisals. Ask what happens if your balance exceeds the permitted borrowing base.

Some lenders finance both new and used equipment. Age, condition, remaining useful life, resale value, and the seller can affect eligibility and financing terms.

A loan finances a purchase; a lease provides use under a contract. Review ownership, down payment, maintenance duties, return conditions, and any final purchase option or balloon payment.

Tax treatment is not automatic. It depends on the transaction, equipment, business use, timing, and applicable rules. Ask your tax professional to evaluate a proposed purchase or lease before relying on a deduction.

Depending on the lender and agreement, funds may support payroll, rent, inventory, supplies, and other eligible operating expenses. Confirm any restrictions on use.

It may help address a temporary funding need when projected cash flow supports repayment. Share seasonal revenue patterns, expected expenses, and the timing of incoming payments.

Compare the proposed payment frequency and total obligation with your expected cash flow, including slower periods. Consider existing debt and all fees. A smaller individual payment does not necessarily mean a lower total cost.