i want an article on the benifits of bank loan
Answers
Answered by
0
Flexibility: With bank loans, you only need to worry about making your regular installment payments on time. This is an advantage over overdrafts, where you must pay the full amount when the bank demands it. In addition, banks don't usually monitor how you use your loan as long as you make your payments on time, so you can invest it however you deem fit.
Cost Effective: In terms of interest rates, bank loans are usually the cheapest option vs. overdrafts and credit cards. According to Bankrate, as of July 2015, that the average fixed interest rate for credit cards was 13.02 percent, while certain bank-provided loans guaranteed by the Small Business Administration have a maximum interest rate of 8 percent. The lower interest rates of bank loans will definitely save you money.
Retained Profits: While businesses that issue equity to raise capital often give a percentage of their profits to shareholders, banks require borrowers to pay only the principal and interest amount on a loan. As such, you will retain all your business profits.
Tax Benefits: When you use a bank loan for business reasons, the interest you pay on the loan is a tax-deductible expense. For example, if you are paying a 5 percent interest rate on a $30,000 loan, then your yearly interest is deductible on your 1040 Schedule C tax form.
Cost Effective: In terms of interest rates, bank loans are usually the cheapest option vs. overdrafts and credit cards. According to Bankrate, as of July 2015, that the average fixed interest rate for credit cards was 13.02 percent, while certain bank-provided loans guaranteed by the Small Business Administration have a maximum interest rate of 8 percent. The lower interest rates of bank loans will definitely save you money.
Retained Profits: While businesses that issue equity to raise capital often give a percentage of their profits to shareholders, banks require borrowers to pay only the principal and interest amount on a loan. As such, you will retain all your business profits.
Tax Benefits: When you use a bank loan for business reasons, the interest you pay on the loan is a tax-deductible expense. For example, if you are paying a 5 percent interest rate on a $30,000 loan, then your yearly interest is deductible on your 1040 Schedule C tax form.
Similar questions