(866) 480-2611

Why Loan Purpose Matters

[et_pb_section fb_built="1" _builder_version="4.5.5" custom_margin="0px||||false|false" custom_padding="0px||||false|false"][et_pb_row _builder_version="3.25" background_size="initial" background_position="top_left" background_repeat="repeat"][et_pb_column type="4_4" _builder_version="3.25" custom_padding="|||" custom_padding__hover="|||"][et_pb_post_title categories="off" admin_label="Post Title" _builder_version="4.5.1" _module_preset="default" global_module="10641"][/et_pb_post_title][et_pb_text _builder_version="4.5.5" background_size="initial" background_position="top_left" background_repeat="repeat"]The purpose of taking out a business loan will vary for each business. There are many different reasons you may want to take out a business loan. Your business loan could be used for cash flow management, new opportunities, or enhancing your existing operations.


When you look at taking a business loan you need to clearly define your purpose in how you will use the funds. Having a clear purpose for the loan proceeds assists a lender in determining the risk characteristics for the loan and the terms for the loan. Knowing what you want to use the money for assists the lender to understand your business and create the best terms available.


Here is a list of some of the primary reasons for business loans:


Cash Flow Management
• Invoice and Purchase Order Factoring
• Increasing Inventory
• Partner Buy Out
• Unforeseen Emergency
• Payoff or Consolidate Existing Debt


Businesses can make use of cash either to convert non-liquid assets into cash or to save on existing loan payments. Increasing sales levels are the goal but the cost can entail an increased need for cash. You may need to increase inventories to handle higher demand or use factoring to convert existing order flow into cash that you can use to fulfill orders.


Businesses may have a need to buy out a partner and loan can spread the financial commitment over an extended period of time. Existing debt can be refinanced to reduce interest rates or improve loan terms.


Businesses may have unforeseen emergencies take place. Businesses could have equipment break down unexpectedly or have unexpected expenses like a major increase in supplier costs.


New Opportunities
• Expansion
• Improvements
• New Equipment
• Acquire a New Location


Opportunities are the life blood of any business with expansion breathing fresh new possibilities. New improvements and new equipment can create more effectiveness that will make the business more efficient and profitable.


A new location may also be just what your business needs. You may want to enhance or expand your existing space or select a new location nearer to your major customers. You may want to add new locations as your business grows.


Enhancing your Existing Operations
• Advertising
• New Equipment
• Improvements


You have built a solid business that is successful. You want to do even better by improving your existing operations. You may look at expanded advertising like a new website or cooperative advertising with non-competing businesses. Equipment eventually wears out. Replacing that equipment can lower energy bills, increase production, and speed order flow. Your business has many improvements you can envision as you grow meaning a business loan may be just what you need.


If you Decide to Get a Business Loan


There are many options for business loans. You can go to your local bank or you can go direct to a business that specializes in lending to businesses just like yours. Banks tend to have time intensive stringent lending requirements and may have terms that can hinder your flexibility for growth.


You can also go to a business like Advance Funds Network where you can work with people that understand what you are trying to accomplish and know from experience the best ways to get you there. Which option you select for your loan you will want to make sure you find the best quality loan available and these are some of the factors to consider:


• Speed of approval and time to receive the funds
• Loan amount available
• Terms and interest rate of the loan
• Understanding what the loan will do for your business and learning what
the appropriate terms are
• Availability of knowledge people in your loan area that know your business
• Qualification requirements to learn best how to frame your loan application


Loan applications and borrowing can be an intimidating experience. You know your business needs and what you want to happen with your business to make your dreams take place. To prepare for the loan process, clearly frame the purpose of your loan before you apply and you can be ready and prepared for taking your business to the next level.[/et_pb_text][/et_pb_column][/et_pb_row][/et_pb_section]


Accounts Receivable
Bad Credit Business Loan 1
Bad Credit Business Loans
Bank Loan
Borrowing Money
Business Capital
Business Cash Advances
Business Debt
Business Equity
Business Financing Services
Business Leadership
Business Line of Credit
Business Loan
Business Loan Bad Credit
Business Loans
Buying Equipment
Cash Flow
Child Care
Construction Factoring
Credit Card Factoring
Credit Reports
Credit Utilization
Equipment Finance
Equipment Leasing
Equipment Purchase
Factoring Accounts Receivable
Flexible Factoring Options
Franchise Funding
Freight Factoring
General Finance
Green Business
Hardware Stores
Industry Specific Articles
Landscape Contracting
Late Fees
Medical Accounts Receivable
Medical Supply Providers
Merchant Advance
Merchant Cash Advance
Merchant Cash Advance Loans
Merchant Finance
Merchant Loan
Mobile Payment Solutions
New York Business Loan
Real Estate Management
SBA Loan
Small Business
Small Business Credit
Small Business Credit Line
Small Business Development Services
Small Business Finance
Small Business Financial Tips
Small Business Investors
Small Business Line of Credit
Small Business Loan
Small Business Loans
Small Business Marketing
Small Business Sales
Small Business Sales
Starting a Small Business
Startup Financing
Trucking and Transportation
Unsecured Business Lines of Credit
Unsecured Business Loans
Unsecured Business Loans for Bad Credit
Unsecured Credit Line for Small Businesses
Unsecured Financing
Unsecured Line of Credit
Unsecured Lines of Credit for No Credit Businesses
Unsecured Loans for Bad Credit

Nurturing Business, Cultivating Hope

Putting Our Clients First Since 2008.
Become A Partner
Partner with us to reach potential merchants using our patented technology on the Advance Funds Network platform.
464 Kings Highway Brooklyn, NY 11223
1633 Rt 35N Unit 4 Oakhurst, NJ 07755
5858 Dryden Place Carlsbad, CA 92008 Suite 238
2967 Dundas St. W. #220D Toronto, ON M6P 1Z2
(866) 480-2611
Important Information About Procedures for Opening a New Account
To help the government fight the funding of terrorism and money laundering activities, Federal law requires all financial institutions to obtain, verify, and record information that identifies each person who opens an account.

What this means for you: When you open an account, we will ask for your name, address, date of birth, and other information that will allow us to identify you. We may also ask to see your driver’s license or other identifying documents.
© Advance Funds Network 2023. All rights reserved.