The Complete Guide to Getting a Mid-Term Business Loan
What is Medium-Term Loan?
Medium-term loans are offered by Banks and lenders like BitX Funding for business. The requester must accept payback agreement terms from the lender before getting the loan. The lender provides an easy installments option with a fixed interest which varies from lender to lender. The borrower can expect terms of 2 to 5 years with interest rates increasing with as the term gets longer.
Why is it called Medium-Term loans?
Short-term, Medium-term, long-term are the types of loans provided by banks and lenders. The word Medium defines the payback period for the loan. Usually, the turnaround time of a Medium-term loan is two to five years.
What is the interest rate on Medium-Term loans?
Well, this question has no standard answer because it depends on the terms and conditions of the bank or lender. Each lender has its discretion matrix for interest ratio. Most of the banks offer an interest rate below 20% whereas, online lenders interest rate can vary between 5% to 30%. Usually, it is directly proportional to your installments cycle and period. The more you drag it, the higher will be the interest rate.
Benefits of Medium-Term loans
Whenever we start a business, it takes time to reach the self-funding stage. After hitting the self-funding landmark, the potential businessmen look to stuff-up the value to their business. To acquire value-added assets, hire more employees, expand the company, a bundle of money is required. Medium-term loans are magic pills to grow your small business from nothing to everything.
Installments: Medium-term loans allow the requester to pay back the loan amount monthly on a set term and rate. The customer can choose between a 2- and 5-years term depending on what the lender offers.
Flexible Payback Period: It has reliable repay duration; up to 5 years which can be further extended, keeping the bank’s policies intact. Additionally, the candidate knows how much to pay each month. So, he or she can plan their financial activities. The nice thing about mid-term loans is there are no prepayment penalties so if the borrower comes into money, they can pay it off early and save on interest.
Fix Interest rate: The property of fixed interest ratio is a true meaning of benefit. In term loans, lenders charge a fixed interest on each cycle payment concerning the deal, made before funding. It helps in budgeting the finance for each segment of the company.
Get higher loans: Once you succeed to return the medium-term loan, it entitles you to request for bigger loans like Long-Term loan. It piles up your credit history, which tells the bank how trustworthy you have been. So, you have a higher chance to receive an approval stamp on the loan application.
BitX Funding terms for Medium Loan:
● Prime + 2.75%
● 10 years with no prepayment penalties
Requirements for Medium-term Business loan:
● Credit Minimum is 680
● Profitable year over year
● Minimum Revenue per Year $250,000
● Minimum Time in Business 2 Years
● No change in ownership within 2 years
BitX Funding is the online marketplace for small business owners looking to fund a project. We specialize in connecting small business owners with lenders who will compete for your business. We believe small business owners drive the economy and we are passionate about helping your company reach its full potential.
You can reach a loan specialist by toll-free at 1-800-824-2407, or email at email@example.com, or apply online here and we can guide you on which loans are the best fit for your business.