Are you aware of a term loan? A Term loan is basically short term loans that are provided to businesses to fund their expenses. It could be for business expansions and capital expenditure, and more.
The tenor of the term loan is generally tailor-made to cater to the financial needs of businesses. A term loan comes with minimal documentation, easy to meet eligibility, instant approval. Other features like hassle-free funds disbursement and flexible tenor make this credit facility an apt choice to finance your enterprise needs.
Depending on your needs and eligibility, you can avail of term loan that may assist you to meet all your planned or unplanned outlays of your firm. If your CIBIL score is higher, you may get lower term loan interest rates. In turn, it may help you repay reduced EMIs and save big.
If you wish to apply for the term loan, then you can do that online on a leading lender’s website and save you time. However, before you do that, you need to be aware of a few vital aspects of it. Go through this post and know more!
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Fixed loan amount
Term loans come with a fixed amount. As per the type of term loan that you go for, the loan amount may vary. Depending on your loan eligibility and the lender’s policies, the final loan amount may differ. One can also use the loan eligibility calculator on a lender’s website to know an amount that you may be eligible for.
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Fixed repayment tenor
Availing the term loan means that you can repay the loan over a fixed period. Depending on the duration of the loan repayment, it is known as a short, mid or long term debt.
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It may or may not require any collateral
Applying for the term loan and the amount of money availed as per your lender’s policies and other aspects; the loan is available as secured and unsecured credits. If you avail of a collateral-free loan, you may have to deal with higher term loan interest rates. But having a higher CIBIL score may also negotiate for lower term loan interest rates.
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It may come with a fixed or floating rate of interest
Term loans may be available at both fixed and floating interest rate. It is up to the borrower to decide what types of term loan interest rates are right for them.
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Fixed repayment schedule
You should also know that a term loan comes with repayment duration, and you are supposed to pay the EMIs as per the schedule. The loan EMI comprises both principal + interest element. It is calculated as per the applicable term loan interest rate. Thus, it enables a borrower to repay the loan easily. It is possible to know about the exact EMI amount before availing of the loan. It is possible via the online loan EMI calculator, which is available on a leading lender’s website.
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You should compare all loan offers online
When applying for a term loan online, you may come across different loan offers from diverse lenders. It may confuse you which one to select and not. Hence, one of the key considerations before a term loan is to compare all loan offers online. You can do that on a third-party website and pick a deal matching your needs and budget the best.
You are now well aware of the aspects of the term loan. Being aware of all can surely help you approach the loan with increased confidence.
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