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A Multi Year Term Loan is a business term loan that has a repayment schedule over 2 to 5 years. A term loan that amortizes over a several years has low monthly payments and provides better ongoing cash flow for day to day operations. In order to qualify for a Multi Year Term Loan the business must have owners with good personal credit, strong business trade credit, and good historical cash flow.
The terms and conditions of a Multi Year Term Loan are going to depend on the overall strength of the business and it’s owners. Underwriting will look at the enterprise risk of both the company, which includes; operating history, trade credit, cash flow, sales trends, deposit consistency, etc. and the owner, which includes; personal credit score, management bio’s, background checks, etc.
The application process to apply for a Multi Year Term Loan is easier then applying for both Asset Based Loans and SBA Loans. Although there is less paperwork and lower requirements, the application process still involves company financials and tax returns to be available for a lender to review.
SMB Compass's simple and secure online loan application can be completed in a matter of minutes. Quick & Easy!
After we process your application we will contact you and provide you with the best loan offer.
Once your loan is approved in as little as 48 hours. You will have capital deposited directly to your business bank account.
A Multi Year Term Loan can be used by industries that sell directly to other businesses or industries that sell directly to consumers. Based on the wide variety of ways that the money can be used and the limited restrictions or covenants that coincide with this type of financing, a Multi Year Term Loan is a perfect fit for businesses with strong credit profiles.
There are a variety of reasons why a business would use a Multi Year Term Loan. The top reasons include;
While these are some of the top reasons why a business owner would use a Multi Year Term Loan, there are variety of others. Depending on what industry a business is in and the stage in it’s lifecycle, a Multi Year Term Loan could be used with different objectives in mind.
At the end of 2017 a Performance Cycling Store based out of Ohio came to us as they were looking to expand their business through an acquisition of a new store. In addition to the acquisition, they also had short term debt that was taking away from their day to day cash flow. The short term debt was amortizing over 18 months and the price to purchase the store was $250,000. Using the owners strong personal credit and the strong operating history and trade credit of the business, we were able provide a $385,000 Multi Year Term Loan that amortized over 5 years. Not only did the Multi Year Term Loan stretch the short term debt over a 5 year period, but the acquisition of the new store resulted in 40% more revenue, instantly!
If you’ve been in business at least one year, have at least $100,000 in annual revenue, and have a personal credit score of at least 600, you are eligible.
We use a number of different data points to instantly provide you with the best possible loan offer, including competitive rates and payment terms that work for you and your business.