The repayment term for any loan is generally predetermined. While you can get in trouble for repaying your loan slower, most lenders won’t mind if you pay more than the monthly installment amount every month and make the full repayment earlier than the term.
Whitestone Fund specializes in merchant cash advances and business loans in NYC. Here are some tips for repaying your business loans faster from our experts.
Consider Debt Consolidation
If you have multiple debts that you want to pay as soon as possible to avoid high-interest rates, debt consolidation may be the solution. Debt consolidation is a financing strategy where you take out a new loan to pay off all the other loans. Existing debts are rolled into a single payment, and the new loan is used to make that payment. You can also pay for other liabilities with a debt consolidation loan.
A debt consolidation loan can have a better repayment term, lower interest rate, and more favorable monthly payments than your existing debts. A business loan or a cash advance can be used as a debt consolidation loan. Talk to an expert at Whitestone Fund to learn more.
Gradually Increase Your EMI
Equated monthly installment or EMI is the amount you pay to your lender each month. EMI includes the principal and the interest, so the higher your EMI, the fewer installments you’ll have to pay to make full repayment.
When you took out the loan, your EMI was set according to your financials at the time. If you’re a growing business, you can afford a higher EMI now and will be able to afford an even higher one in the future. Talk to your lender about increasing your EMI as your business gets more profitable.
Direct Any Extra Income to Repaying The Loan
It’s possible that your business doesn’t have a consistent revenue or cash flow. You may be able to afford a high installment one month but struggle to pay even the EMI amount the next one.
Instead of increasing your EMI, you can pay more than your EMI on months you receive extra income. This is called prepayment, and it lowers your principal outstanding and interest burden. You can also pay one extra EMI every year to make full repayment a few months earlier.
Bonus Tip: Get a Merchant Cash Advance in NYC
If you haven’t taken out a loan yet, and want one with easy repayment options, a merchant cash advance may be right for you. Whitestone Fund offers cash advances in NYC with weekly and biweekly repayment over a term of up to 36 months. We can help you secure up to $1,500,000 in cash advance for your business. Click here to connect with one of our experts now!
Disclaimer: This article is meant for educational purposes only and does not constitute or should be relied upon as financial advice.