Sara Routhier, Managing Editor and Outreach Director, has professional experience as an educator, SEO specialist, and content marketer. She has over five years of experience in the insurance industry. As a researcher, data nerd, writer, and editor she strives to curate educational, enlightening articles that provide you with the must-know facts and best-kept secrets within the overwhelming world o...

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Joel Ohman is the CEO of a private equity-backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He also has an MBA from the University of South Florida. ...

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Reviewed by Joel Ohman
Founder, CFP®

UPDATED: Nov 2, 2012

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Are you an entrepreneur with a fresh, new idea for a business? Startups can be expensive, but with the help of a startup business loan, you can begin turning your idea into a reality.

[loansform]It’s vitally important that aspiring business owners attain an adequate amount of capital for a successful launch. Lack of funding can stifle or smother an operation just when it begins to find its footing. Small commercial loans for startups provide entrepreneurs with a silo of cash to tap into when they need money.

Whether you need funding for inventory, rent, product development, employee wages, or a number of other uses, a business loan for startups is often the perfect tool for budding owners.

The terms and interest rates associated with this type of borrowing vary from lender to lender, but one can usually expect to see a term of two to ten years, and rates between 2 and 5 percent.

To qualify for a startup business loan, borrowers should prepare to explain to lenders how they expect to repay their debt. Lenders need to feel secure when lending money, so they often request borrowers offer collateral. Collateral usually comes in the form of business equity, company equipment, or personal real estate property.

Additionally, since startups don’t have much of a financial track record, the individual applicant’s credit history is usually taken into account.

To learn more about loans for new businesses, be sure to check out our articles, frequently asked questions, and business-related news.