Loans can be tricky business especially when you’re left with no other options. There is a large stigma when it comes to borrowing money and for the most part it is somewhat exaggerated as there are a number of reputable providers out there. That said, because some laws aren’t too strict you have to watch out for sneaky companies who are out to get a quick steal. Here we take a closer look at some of the things companies miss when reading the small print on their business loan.

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The Anxiety Of APR

APR stands for Annual Percentage Rate. In regards to any kind of loan this relates to how much money you will end up paying back after you’ve borrowed. Most companies are quite clear on their figures and are happy to admit if they have a high percentage of repayment. Some rates can even go up to a staggering 3000%. You should never go into an agreement without having this percentage written in stone as they may decide to increase it down the line if you’ve not signed up on a specific rate.

Early Repayment Charges

You would think that these companies would be delighted that you’re giving them their money back early, but it turns out that early repayment can result in charges at the loan providers end. Many companies are happy to take the hit if they have a steady income but other businesses may charge you at the last minute, leaving you suddenly more out of pocket. If however you feel the charge is not fair or you were not made aware of it prior then you can always dispute it with the provider and they may drop the charge.

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Sneaky Interest Rates

If you decide to borrow money from a banking provider, whether you already bank with them or not, then you could benefit from the perks of low interest rates. These interest rates are great as they give you a little extra cash for minimal extra charge which can help in sticky situations. However if you don’t check the interest rate you could pay almost double the amount back. If you already bank with them then they are less likely to mess you around but you will still need to read the small print carefully.

Costly Collateral

Any time that you are agreeing to borrow money you are putting yourself in the line of fire. If i the event you cannot make a payment you have to be prepared to face the consequences. Normally the loan provider will accept the delay or send out debt collectors to help make the payment, but if you deal with a dodgy finance company then you may end up loosing your business all together. You may also have to put up your own property as collateral if the collectors can’t reach their target.

Business loans are a great help, but you need to make sure you’re dealing with the right people. For more information on loans and to find out what else is involved simply have a look around online.