At a certain point, you might need to start spending more money on your business in order to make money in your business. But acquiring the capital for your growth plans can be difficult. With daily operating costs and other expenses, you need to find a new source of income or financing.
Borrowing money is nothing new in the world of business. Many do this to start an entrepreneurial career, while others do so to fund their expansion. No matter why you decide to take out a loan, you have to choose it carefully.
Bridging the Gap between Financing & Business Growth
Many financing solutions have become available to business owners recently. One of them is the bridge loan. But what is a bridge loan?
A bridge loan is a short-term loan that provides quick funding while you look for a more permanent solution. Business owners use it to handle an existing obligation and reduce their obstacles in the long run. It’s becoming common among small businesses, but before you take out a bridge loan, it’s essential to study its benefits and terms.
Here are the advantages and disadvantages of a bridge loan.
Benefits of a Bridge Loan:
Bridge Loans are a fast way to get funding for your immediate needs.
The whole process—application, approval, and funding—is faster than most other types of loans because our bridge loans have fewer requirements. This gives you the capital to purchase new or additional equipment, pay for inventory, or meet your payroll needs without affecting your bottom line.
Bridge Loans give you full control over your business.
For most loans, you have to sign over a portion of your business as collateral. But a bridge loan from Probably may only last a year, meaning you can quickly pay it back without having to relinquish control over your business.
Bridge Loans give you a safety net for other expenses.
As a small business, you are often at risk of running out of cash. Our bridge loans give you access to money that can be used to cover pertinent expenses. It’s a practical and valuable solution for businesses that have long payment cycles.
Potential Cons of a Bridge Loan:
It might have larger payments.
Since a bridge loan runs for a shorter period, you might be charged more during monthly repayments if you don’t choose a good company to work with, and understand their terms. Late payments will be met with penalties and higher interest rates as well. Make sure you work with someone trusted and transparent, like Probably, to ensure you get the best deal!
It could be risky for your short-term bottom line.
Business owners who take out a bridge loan while waiting on an extended payment cycle are at risk of failing to see that long-term money at the end. And when payments fall through, you will have to make your loan payments out of pocket. This is the risk with any loan, but is still worth mentioning. As always, only borrow what you expect to be able to pay back.
Work with Probably for a Trusted, Transparent Bridge Loan
Probably is dedicated to helping small business owners transform their start-ups into strong and sustainable organizations. Our bridge loans are customized to each client, giving them what they need without causing disruptions in their operations and cash flow.