Small Business Loan Terms


Annual Percentage Rate (APR)
The actual amount of the loan—including all annual interest and any other fees associated with the loan.
Interest Rate
A rate given by the lender attached to the total amount of the loan. It is determined by how long it will take to repay the loan.
Line of credit
Also referred to as the LOC, it is how much money a lender is willing to loan to your business
Something you promise to the lender as a full repayment of the loan in the case you cannot repay the loan. This usually is something of high value, such as a retirement fund, or your house.
Repayment penalties
Some lenders can charge anywhere from 2% to 5% penalty if you decide to pay the loan earlier than expected.
The length of time given to repay the loan.
Unsecured loan
This is a type of loan where the lender does not require any type of collateral. This happens when a business has a high credit score and a great financial history. 
Secured Loan
Type of loan that requires collateral to attain the capital.
Working Capital
The available amount of capital you have to pay off your current debts.
The term used to describe the lender's opinion of the borrower's competency in regards to running a business and managing the assets of the loan payments
How much your company is worth after factoring any debt it may owe.
FICO score
The part of your credit report lenders look at most. Standing for Fair Isaac Corporation (named after the creators of this score), the FICO score ranges from 300-850. A score of 650 or above is considered a good score.

Find Pre-screened Vendors

Compare top rated vendors in more than 80 categories. Minimize the risk of hiring unknown contractors

Visit the Vendor Center now or select a category below:

Related Articles
Compare Top Rated Vendors
Grow Your Business with High Quality Referrals