The Different Types of Commercial Loans Available in Australia

When it comes to commercial loans, there are many different options available to businesses in Australia. The type of loan that is right for your business will depend on a number of factors, including the size of your business, your credit history, and the purpose of the loan. In this article, we’ll take a detailed look at the different types of commercial loans available in Australia and what the eligibility requirements are for each one according to commercial loans experts in Melbourne.

 Type of Loan #1: Business Term Loan

This is a business term loan is a loan that is given to a business for a specific purpose, such as funding the purchase of equipment or expanding your premises. The loan is repaid over a set period of time, usually between 2 and 5 years. To be eligible for a business term loan, you must have been in business for at least 2 years and have a good credit history.

Type of Loan #2: Business Line of Credit

A business line of credit is similar to a business term loan in that it is given to a business for a specific purpose. However, the key difference is that with a line of credit, you only pay interest on the amount that you borrow, rather than the full value of the loan - this makes a line of credit an ideal option for businesses that need flexibility when it comes to repayments. To be eligible for a business line of credit, you must have been in business for at least 2 years and have a good credit history.

Type of Loan #3: Invoice Finance Facility

An invoice finance facility is a type of loan that is used by businesses to free up working capital that is tied up in unpaid invoices. With this type of loan, you can borrow up to 85% of the value of your unpaid invoices, which can then be used to fund your day-to-day operations or make other investments in your business. To be eligible for an invoice finance facility, you must have been trading for at least 12 months and have issued invoices totalling at least $10,000 per month.

Which option best accommodates your specific needs?

There are many different types of commercial loans available in Australia, so it's important that you do your research before applying for one. The type of loan that you choose will depend on factors such as the size of your business, your credit history, and the purpose of the loan. We hope this blog post has given you some insights into the different types of commercial loans available and what the eligibility requirements are for each one. Good luck!