Top Ten Business Loan Terms Every Business Owner Should Know.
As a business owner seeking to grow your business with the aid of a loan, it is important to have an understanding of the terminologies surrounding business loans. While you do not have to be a financial expert, being familiar with some key terms and definitions surrounding business credit and loans, can earn you lenders’ trust and increase your chances of getting favourable feedback from them. Essentially, your financial literacy accords you a good leverage.
We have outlined the top ten business loan terms every business owner should know. They are;
- Credit Score: The number that shows a customer’s credit worthiness which is often accumulated over a period of time.
Usage: The higher your credit score, the higher your chances of getting a loan amount you need.
2. Collateral: Property that a customer is expected to provide that serves as a guarantee of repayment for the loan.
Usage: With www.biznurture.com customers do not require collateral to access loans.
3. Default: Failure to pay up a loan as at when due.
Usage: Inorder to improve your credit score, one must avoid default on loans.
4. Amortization: The gradual repayment of a loan periodically usually on a monthly instalment basis.
Usage: With www.biznurture.com you can rely on the transparency of our calculations and view your amortization when you login to your account.
5. APR: Annual Percentage Rate. The annual rate or amount that a borrower is charged with.
Usage: Before settling for a loan with any platform be sure that you fully understand the APR to avoid hidden charges.
6. Principal: The original sum of money borrowed in a loan or put into an investment.
Usage: The amount charged as interest is usually calculated based on the principal.
7. Early Repayment: The provision that allows a customer to repay their loan earlier than the actual repayment date.
Usage: Did you know that with www.biznurture.com you can make an early repayment on your loan and avoid accumulated fees beyond the payment date.
8. Secured Loan: A loan backed by collateral-financial assets owned by the customer which can be used as repayment to the lender in any case of default.
Usage: Business owners in Lagos and PortHarcourt can access secured loans when they sign up with us via www.biznurture.com
9. Credit Rating: An assessment of a borrower’s creditworthiness with respect to a particular debt or financial obligation.
Usage: Failure to repay in due time can negatively affect a person’s credit rating.
10. Cash Flow — The amount of money that flows in and out of a business calculated on a monthly basis.
Usage: Female entrepreneurs can access up to 3 million Naira with FemPreneur Loan. FemPreneur is a product designed by www.biznurture.com to encourage women in business with steady monthly cash flow.
