Business Loans Definition:

A business loan is a type of debt. It is in many cases used to finance an existing business for extra capital, a franchise or a new venture. Maybe a business wants to purchase extra machinery or needs to buy its property or land, a business loan could be used for these purposes. Like all debts, a business loan entails the redistribution of financial assets over time, between the lender and the borrower. The borrower initially receives an amount of money from the lender, which they pay back, usually but not always in regular instalments, to the lender. A business loan may, but not always, attract a higher level of interest due to the more risky nature of the loan and when assessing the borrower the lender may take into account the financial standing of the company as well as it's Directors.

Acting as a provider of business loans is one of the principal task for financial institutions. For banks business loans are generally funded by deposits.

Other types of business loans include mortgages and credit card debt. A mortgage is a very common type of business loan where the money is being used to purchase land or property.

Typical lenders include Banks, Building Societies and Other Financial Institutions. Please click on one of the above sponsors if you are looking for a quotation for a business loan.