Securing the right business loan starts with understanding how each option works. Whether you're expanding, looking for working capital, or funding a new project, knowing the differences between loan types can save you time and frustration. 1. SBA Loans SBA loans are backed by the U.S. Small Business Administration. They offer longer terms and competitive rates but require strong documentation and a clear business purpose. These loans are great for established businesses ready to scale. 2. Term Loans A term loan provides a lump sum upfront that is paid back over a set period. This is one of the most common forms of business financing and works well for equipment purchases, growth initiatives, or refinancing existing debt. 3. Asset-Based Financing Asset-based lending is secured by your company’s assets—accounts receivable, inventory, or equipment. It’s often used when businesses need flexible financing but don’t qualify for traditional options. 4. Working Capital Loans These loans help cover short-term operational needs. They’re designed to smooth out cash flow and give businesses breathing room during growth or seasonal slowdowns. 5. Private Credit Private lenders can offer faster decisions and more flexible terms than traditional banks. They’re a practical option for businesses that need capital quickly or don’t fit within bank requirements.