Short Term Loan An Overview of Short Term Loans
Author: Grant Olsen
Date posted: 01.08.24

With no collateral required, no restrictions on the use of funds and a lightning-fast turnaround, unsecured short term loans are among the most flexible and popular products. These loans go up to $1 million, generally take 1-2 days to fund and have term lengths ranging from 6 months to 3 years.

Short Term Loan

Business growth is one of the most common key considerations for any business owner. Obtaining a short-term loan can prove helpful in those growth efforts. Typically, businesses face two main funding options – secured loans and unsecured loans.

 

 

What is an unsecured short-term business loan?

An unsecured business loan, as the name suggests, does not require collateral. Instead, the lender evaluates factors such as the small business’s creditworthiness and cash flow to determine qualification.

 

In contrast to secured loans, which often come with strict qualifying metrics, unsecured short-term business loans offer a much simpler qualification process and a significantly faster turnaround time – mere days instead of months. Thanks to the rapid development of Internet technologies, businesses can now secure an unsecured loan from online lenders within just a few hours.

Benefits of short term loans

 

  • A simple and quick application and funding process –Typically only a completed application and a few months business bank statements are needed to apply. Approvals can be issued within hours and in many cases, funding can occur within one day.
  • No collateral required, thus offering businesses greater flexibility and reducing the risk of asset loss in case of default.
  • Flexible credit score requirements. The minimum credit score needed for an unsecured short term loan is typically just 500 or higher. 
  • Allows flexibility on use of funds. Unsecured loans have no usage restrictions, unlike traditional secured loans that impose strict measures and require detailed proposals for approval. This grants you total control over how to utilize the loan, whether it’s for hiring new staff, expanding operational space, or any other business needs.
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Wrap up

If your business requires rapid financing and prefers a straightforward application process, an unsecured short-term loan could be an excellent option.

About The Author | Grant Olsen

Grant is a writer specializing in small business loans, leadership skills, and growth strategies. He is a contributing writer for KSL 5 TV and has been featured on FitSmallBusiness.com and ModernHealthcare.com. Grant has a B.A. in English from Brigham Young University.

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