Lump-sum business financing

Business Term Loans for Expansion and Major Investments

A term loan provides a lump sum that you repay over a set period. It fits a defined investment, such as opening a second location, renovating your space or taking on a major project, when you want a clear repayment plan from the start.

Start with a short application. An advisor reviews your plans and explains which term loans may be available, including rates, terms and fees.

Two project leads in hard hats reviewing building plans at an expansion site
What it is
A lump sum repaid over a set term
Rate types
Fixed or variable, depending on the provider
Payment schedule
Monthly for many loans; some short-term loans collect weekly or daily
Commonly used for
Expansion, renovation, equipment and refinancing

Loan amounts, terms and rates depend on the provider and your business profile.

How it works

One amount, a defined repayment plan

You receive the full loan amount at closing and repay it over the agreed term. Most term loans are amortizing: each payment covers interest and part of the principal, so the balance reaches zero by the end of the term.

Rates may be fixed for the life of the loan or variable, tied to an index such as the prime rate. Not every term loan has fixed monthly payments. Some shorter-term business loans collect payments daily or weekly, and variable-rate payments can change.

Bank and SBA term loans often run several years and require more documentation. Online and alternative providers may offer shorter terms with a simpler process and a higher cost.

Compare more than the rate. Ask about the payment frequency, origination fees, prepayment terms, collateral and any personal guarantee. Two loans with the same rate can have very different total costs.
Contractor laying floor tile during a commercial space renovation
  1. Define the investment

    Know what the funds will pay for and how the investment will support repayment.

  2. Apply and document

    Provide bank statements and, for larger amounts, tax returns and financial statements.

  3. Review the offer

    Compare the amount, rate, term, payment schedule, fees and collateral requirements.

  4. Close and repay

    Funds arrive as a lump sum, and payments follow the schedule in your agreement.

Estimate a payment

See how amount, rate and term shape a payment

Enter an amount, an example rate and a term. The calculator shows a fully amortizing payment so you can see how each input changes the cost.

Try your own numbers

Enter any rate to see how it changes the math. This is not a quoted rate.

Payment schedule

Estimated monthly payment

$4,911

Number of payments
36
Total of payments
$176,789
Interest in this example
$26,789

Educational example only. Not a quote, offer or approval. It assumes a fixed rate, equal payments and no fees. Actual rates, fees, payment frequency and terms are set by the provider after underwriting.

Is it a fit?

When a term loan may make sense

It may fit when

  • You have a specific investment with a clear cost and timeline.
  • You want payments you can build into a budget.
  • The investment will support revenue or savings over the life of the loan.
  • Your business has an operating history and financial records to share.

Another option may fit better when

Uses of funds

Investments businesses finance with term loans

Expansion and new locations

Fund a buildout, a second location or added capacity.

Renovation and improvements

Update a storefront, kitchen, office or production space.

Major purchases

Make a large inventory or equipment purchase you will use over time.

Refinancing

Replace higher-cost debt with a structure that may be easier to manage.

Hiring for growth

Add staff for a new contract or service line.

Acquisitions and projects

Finance a defined project or the purchase of a business.

Qualification

What providers typically review

Term loan requirements vary widely between banks, SBA lenders and alternative providers. These are common factors, not universal minimums.

Operating history
Many term loan providers look for an established track record. Requirements differ widely by provider.
Revenue and profitability
Providers check that cash flow can cover the payment, often looking at profit as well as revenue.
Credit
Personal and business credit history influence approval, rate and term.
Debt service
Existing obligations are weighed against cash flow to judge how much new debt the business can carry.
Collateral and guarantees
Larger loans may require collateral, a general lien on business assets and personal guarantees from owners.
Use of funds
A clear plan, such as quotes or a project budget, supports the request.
Next step

Put a clear repayment plan behind your next investment.

Share your business details and what you plan to fund. An advisor will explain term loan options that may be available, including the rate type, term, payment schedule and fees.

Costs and terms

What shapes the cost of a term loan

The total cost depends on the rate, the length of the term, fees and how often payments are made.

Terms to know

Interest rate and APR

The interest rate is the cost of borrowing. The APR also reflects certain fees, which helps when comparing offers.

Fixed or variable

A fixed rate stays the same for the term. A variable rate moves with an index, so payments can change.

Amortization

How each payment splits between interest and principal. Early payments carry more interest.

Origination fee

A fee for processing the loan, often deducted from the amount you receive.

Prepayment terms

Some loans charge a fee for paying early or do not reduce interest when you pay early. Others allow early payoff without a penalty.

Collateral and liens

Many lenders file a UCC lien on business assets and require personal guarantees.

Tradeoffs to weigh

  • A longer term lowers each payment but usually increases total interest.
  • Daily or weekly payment schedules can be harder to manage than monthly payments.
  • Fees deducted at closing reduce the cash you actually receive.
  • Prepayment terms determine whether paying early saves money.

Hypothetical example

How the term changes the total cost

A business borrows $150,000 at an example fixed rate of 11% per year with monthly payments.

Monthly payment over 36 months
About $4,911
Total interest over 36 months
About $26,789
Monthly payment over 60 months
About $3,261
Total interest over 60 months
About $45,682

Hypothetical illustration with no fees. Not an offer or a quote. Actual rates and terms are set by the provider.

The process

What happens after you apply

Weighing a term loan against SBA or equipment financing? Start the application and an advisor will review it with you, or call to talk it through first.

Questions first? Call 619-387-5891
  1. Complete the application

    Share basic details about your business, the amount you need and what it will fund.

  2. Send your documents

    Provide your last four business bank statements, plus tax returns and financial statements for larger amounts.

  3. Review options with an advisor

    Correia Financial identifies providers whose programs may fit and explains any offers, including the rate, term, fees and payment schedule.

  4. Provider review

    The provider completes its own underwriting and may request more information. Approval and final terms are the provider’s decision.

  5. Close and receive funds

    If you accept and sign, the provider disburses the loan. Timing depends on the provider and the loan.

Compare

A term loan compared with related options

FeatureTerm loanBusiness line of creditSBA 7(a) loan
How you receive fundsOne lump sumDraws as needed, up to a limitUsually a lump sum; some 7(a) options are lines of credit
Typical lengthSet by the provider, from months to several yearsRevolving, often reviewed or renewed periodicallyGenerally up to 10 years, or up to 25 years for real estate and long-life equipment
PaymentsScheduled, often monthlyBased on the amount drawnMonthly, over a longer term
Review processRanges from streamlined to full underwritingVaries by providerMore documentation and SBA eligibility rules
Best suited forA defined investmentRecurring or uneven needsEstablished businesses that can wait for a fuller review

General comparison. Features vary by provider and agreement. SBA maturity limits from SBA program rules.

Do all term loans have fixed monthly payments?

No. Many have fixed monthly payments, but some carry variable rates that can change, and some shorter-term business loans collect payments daily or weekly. Your agreement states the rate type and schedule.

How long are business term loans?

Terms range from under a year for some short-term products to many years for bank and SBA loans, depending on the provider and the purpose of the funds.

What can I use a term loan for?

Common uses include expansion, renovation, equipment, inventory, hiring for growth and refinancing other debt. Providers may restrict certain uses.

Can I pay off a term loan early?

Often, but terms vary. Some loans charge a prepayment fee or do not reduce the interest owed when you pay early. Ask before you sign.

Do I need collateral?

It depends on the amount and the provider. Many term loans include a general lien on business assets and a personal guarantee, and larger loans may require specific collateral.

How is a term loan different from an SBA loan?

An SBA loan is made by a participating lender with a partial guarantee from the U.S. Small Business Administration. It follows program rules on eligibility, use of funds, terms and maximum rates, and usually requires more documentation.

Resources

Learn before you apply

Guides that answer the questions owners ask about this kind of financing.

View all resources

Take the next step

Build the Next Chapter of Your Business.

Whether you’re opening a location, renovating your space or taking on a major project, start by exploring financing with a repayment plan that fits. Share your business details so Correia Financial can review potentially available options and help you compare the terms.

Complete the application and provide your last four business bank statements for an initial review. Larger amounts may require tax returns and financial statements.

Correia Solutions LLC dba Correia Financial is a business financing brokerage, not a lender. Availability and terms depend on each provider's requirements and underwriting. Applying does not guarantee approval or funding.