Small business loans in the Finger Lakes Region are offered in various types and have individual requirements dictated by the lender. The choice you make depends on your loan purpose (what you will use it for), your personal or business credit rating, the terms and interest rates that best suit your needs.
Typically, small business loans can be secured or unsecured (depending on amount and repayment terms). Signature loans are one such tool that can be obtained without a security or collateral (such as your house or other tangible asset).
What Exactly is a Signature Loan
Are you considering a signature loan? This is one of the easiest loan types if you have a good relationship with your lender. The signature loan, also known as a “good-faith” or “character” loan is offered by many local banks that use only the borrower's signature (hence the name) and their promise to pay as the collateral. There are no requirements to put up any type of asset or collateral to secure the loan. It can be used for a myriad of purposes without restriction, though the interest rates may be higher than other types of loans due to the lack of any real asset to secure it.
What Does the Lender Look For
To determine whether to grant a signature loan, a bank or credit union typically looks for a solid credit history and sufficient income to repay the loan. In some cases, the lender may require a co-signer on the loan, but the co-signer only signs a promissory note and is only called upon in the event the original borrower defaults on his payments.
These loans are commonly used in small towns and areas where individuals and business owners have closer relationships with banks. A good community reputation and the good borrowing position needed for any unsecured loan are common requirements. This is actually a very good option when you need a smaller amount of money to work with. You can apply in person to your local lender or apply through their online website. Most likely, in a small community, you will want to speak directly with your bank or credit union to discuss options and obtain the best product to fit your needs.
Signature Loans vs. Unsecured Term Loans
As we all ready know, a signature loan is a type of unsecured term loan. Unsecured refers to the fact these loans are not secured by collateral like home mortgages and car loans. Term means the loan is paid off in a set period of time, usually in equal monthly installments throughout the term.
The signature loan is a one-time loan and does not replenish itself like a line of credit loan. You will be paying equal monthly payments throughout the term of the loan on the whole amount, not just what you spend.
Small Business Loans in Tompkins County
With so many options available, speaking with a trusted lender will assist you in making the best decision for yourself and your business. Your comfort level with debt depends on your situation, purpose for the funds, and spending habits.
The credit union partners behind Business Loan Connection can help you fulfill your small business potential with affordable capital and expert advice. Our presence here brings you options for small business loans in Central New York. You can trust our experience and find the exact method to finance your business and get started realizing your dream and vision.
Contact us for more information and to begin the process. We look forward to serving your small business needs.