Business expansion loans are specially structured to fund the expansion of an existing business with a trading history of at least three years. These loans can be used to expand in the domestic or offshore markets. Expansion might occur by developing new product range, leasing bigger premises, employing more staff, digitising processes, pivot the entire business, create e-commerce opportunities, and develop licensing arrangements.
Opportunity to access funds to grow market share, improve competitive posture, increase economies of scale, and expose existing/new products to the global marketplace which may ultimately increase profitability and the capital value of the business. If security is not required, business loans can be settled in less than seven days.
Depending on the size of the loan and the lender, the loan may be unsecured or secured. If security is required which is likely for large amounts, this may include real estate, accounts receivable, stock, plant & equipment, and goodwill, in which case the lender will register appropriate security interests over those assets. If the amount borrowed is more than 80% of the value of security offered, lenders may require Lenders’ Mortgage Insurance which essentially protects them in case of default. This will be an additional cost to the borrower. This means, if the borrower defaults in their repayments and cannot repay the amount owing the lender may compel them to sell the business and the real estate security to settle the debt in full and also call on any personal guarantees provided to support the loan.
The borrower will be required to pay interest at a fixed or variable rate or a mix of the two on the principal outstanding and any agreed upfront, ongoing and exit charges. Business loans are flexible and can be repaid over a short or long term. Short-term loans can be for 3 months to 2 years and long-term loans can be for many years.
To be matched with a Business Expansion Loan bidder, just follow our anonymous Business Loans/Business Expansion listing process.
