If you have recently launched a business or are looking to expand, chances are that you will need outside funding. As you have probably already learned, acquiring business funding can sometimes take a long time. With a bank loan, for example, you may wait several weeks or even a few months while the lender processes the loan and finally approves it. Unfortunately, your need for cash doesn’t go away while you wait. The good news is that you can apply for a bridge loan.
What Is a Bridge Loan and How Should You Use It?
The term bridge loan refers to money your business receives as it waits to receive longer-term funding. Most lenders set the terms of a bridge loan for no longer than 12 months. Having up to a year of funding for capital needs and everyday expenses can be a huge relief for any business owner. You are free to use the funds any way you see fit.
Simpler Application Process
Because bridge loans are short-term, most lenders offer a simplified application that they approve or deny within a matter of days. You should understand that you will pay a higher interest rate on a bridge loan due to the convenience factor than you would a more traditional type of loan. However, you can avoid paying steep interest charges by paying more than the minimum amount due each month. Taking this action would also pay the loan in full before the one-year term expires.
Are You Interested in Pursuing a Bridge Loan?
As an alternative financing company, Magis Funding offers bridge loans and several other non-traditional business finance options to our clients. We invite you to contact us today to request an application, learn more about bridge loans, or schedule an appointment with a financial advisor to obtain more information about our other financing programs.