Long Term and Short Term LoansLong-term and short-term loans
Choice between a long-term or short-term commercial mortgage
If you need a commercial credit, one of the greatest choices is whether to choose long-term or short-term financing. Long-term loans are usually granted by conventional creditors such as financial institutions in order to satisfy strategy needs such as the acquisition of other companies or the focus on expansion. Like the name implies, they should be paid back quickly and are not suited for long-term investments or credit lines.
Short-term loans, however, are not intended to be used to support large scale ventures, so you may not be able to lend all the cash you need. What kind of financing works best for you depends on your company and its needs. For more information on the financing we provide and to speak to a small businesses specialist, please see our short-term commercial loans page.
Long-term vs. short-term loans
If you are looking for a long or short term credit to cover your expenses, you would have to make a choice. Bankers, mortgagors and other default finance providers are the common source for long-term loans, while payment day and revolving credit companies provide short-term loans.
Below are some fundamental information about long-term and short-term loans that will help you make educated decisions and understanding the differences between the two. Long-term loans have longer due date, while payment day and revolving credit loans usually last for about 14 to 30 business days. However, they can also be used for other purposes. In the case of long-term loans, the creditor extends the amount to be redeemed over a longer term.
Short-term loans do not give the debtor this option, but give him much less chance to pay back the debt. Thus, the creditor is prepared to bring the funds forward without verifying the creditworthiness of the debtor. Short-term loans are therefore more easily qualified and the payment procedure is quicker.