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When starting, or expanding a business of any size, the same debate always arises: where should the funding come from? While business loans are the most traditional means of borrowing, there are always newer and different options. We believe that change and new things are great within our society. Expect for when it comes to this debate. Here are some of the reasons you should take out a traditional business loan over other options such as advances and investors.

Clearer Predictability & Planning Terms

Business loans involve structure, planning, and overall a thorough big picture. When you borrow money from another business, or b2b lending, you will be able to see where and when your money is moving. Due to business loans being the traditional means of borrowing, the structure is also tried, and holds onto the best options that have come to be over time. This path requires more paperwork, a more thorough credit background check, but will provide you with a more secure option.

A Business Loan Can Have Easier Payback Amounts

While same-day advances provide short-term financing, and sometimes even quicker financing, this does not mean they are the most cost effective. When advances are compared with business loans, business loans’ rates are always cheaper in the long run. You have more time to pay back the business loans, typically at a lower interest rate. B2B lending is going to have the best interest in your long-term plan.

According to Business News Daily, “Merchant cash advances can be faster, involve less paperwork, and be accessed by businesses with less credit history. However, they can cost considerably more than business loans, making loans preferable for borrowers that have the time and credit to obtain them.”¹

 So, advances hold some positive aspects, they also seem to hold greater risk than business loans. Along with advances, investors are another highly used alternative. Let’s compare b2b lending and investors, too.

Less Risk & Relationship

Investors typically seem like a great alternative to a business loan, however there is a major drawback here as well – personal emotions. Investors are people, people you more than likely know. They are also typically people who are investing in various things, all at once. They want to keep their money moving just as much as you do. Business loans are not directly people, are specifically set up for you, and include a loan professional. The professional’s job is to not invest his or her own personal money into your business. There is less of an emotional, personal attachment when it comes to business loans.

To get the fast turn around and a secure loan, find the right company who provides a great business loan option. Remember this is money you will be making payments on for years. Take your time to set up the best business loan for you and your company’s goals.

¹http://www.businessnewsdaily.com/9027-business-loan-vs-cash-advance.html#sthash.Onx4xg9j.dpuf