Once your loan has been approved, the next thing to do is to repay your loan, with interest! Be a responsible borrower and understand the payment terms of your loan and be sure to never miss a payment.
Time Of Repayment
The lending company expects you to be a responsible borrower. This means that your business is expected to pay your monthly dues on time. If you are scheduled to make monthly payments, your first payment could probably be 30 days after the receipt of funds. This will all depend on the agreed payment schedule between you and the lender.
Depending on the type of loan program that you have chosen, the start of repayment may always vary and needs to be paid attention to. For example, the start of payment in the Line of Credit Loan Program will only be after the draw window has been closed.
Modes Of Payment
Options for repayments will always vary. It is hard to miss a deadline with all the payment options available right now. For the fixed repayment option, you can do automated payment through your bank account. Transferring money from one account to another account is just a breeze. Check payments are also accepted. All you have to do is fund the account you will be making payments from.
For a cash-flow repayment, the amount will depend on the generated cash flow of your business. If lenders will provide you with a long-term loan, it is important to note the prime rate factor of your loan. If there is an increase in the prime rate, know that the interest rate will also rise and your payment will be higher.
Loan Term
All loans come with a term length. This may vary from months to years or even a decade. Most lenders provide a fixed monthly payment schedule. But there are other lenders who will allow you to make overpayments, to give you a chance to repay your loan earlier than scheduled. This could shorten your term length but ALSO reduce the amount of interest you pay in the long run.
When it comes to Cash Flow Loan Programs, the amount of payment will be dependent on the revenue of your business. It may increase or decrease depending on the income you make through the company. If your business is doing good, your loan term could be shortened.
