Swiftbank Lenders, a small-business funding service in Grand Forks, North Dakota, compares six structures here: working capital, term loans, lines of credit, inventory financing, equipment financing and merchant cash advances. Each is matched to the purpose it suits and how it is paid back. Funding partners review requests and set every rate and term.
The Four Types of Business Loans, Plus Two Other Structures
Business loans are often grouped into four types: term loans, lines of credit, equipment loans and short working capital loans. Inventory financing is a close cousin of the line of credit, and a merchant cash advance is not a loan at all, so this page lists six structures and labels the advance honestly.
| Structure | Repayment shape | Typical uses | What partners may review |
|---|---|---|---|
| Working capital | Equal payments across months, not years | Payroll, supplier bills, a gap before invoices clear | Deposits, receivables, operating history |
| Term loan | Equal installments across an agreed term | Remodels, added locations, acquisitions | Financial statements, tax returns, the plan for the money |
| Line of credit | Interest only on what is drawn; repay, then redraw | Lumpy months and repeating bills | Bank activity, credit history, existing debt |
| Inventory financing | Payments tied to the stock purchased | Shelf stock, parts, merchandise | Inventory records, sales history, supplier quotes |
| Equipment financing | Loan or lease payments; the equipment is collateral | Trucks, vans, lifts, chairs, kitchen lines | A vendor quote, the item's age, cash flow |
| Merchant cash advance | Remitted from future card or bank receipts (not a loan) | Short gaps in card-driven businesses | Card or deposit history, total payback |
Types of Commercial Loans by What the Money Buys
Pick the structure from the purchase, not the product name. A dump truck that earns for a decade fits a longer equipment term; a payroll gap that closes when a general contractor pays fits working capital or a revolving line. Mismatches can be costly: a short advance used for a long-lived truck squeezes cash, and a long loan used for a two-week gap keeps charging after the need is gone.
Types of working capital loan, with examples: a short term loan repaid over months (a contractor waiting on a retainage release), a revolving line drawn and repaid repeatedly (a law firm between settlements), and inventory-backed funding (a convenience store stocking up). The examples are illustrative, not offers.
Business Loan Collateral: Equipment, Receivables, Stock and More
Partners may secure a request with the equipment being bought, business receivables, inventory, real estate or a general lien on business assets, and some ask for a personal guarantee. Equipment financing is the clearest case: the truck or lift itself is the collateral. Which collateral a partner wants, if any, is part of its own decision.
Types of equipment financing come in two broad forms: an equipment loan, where you own the item and it secures the debt, and a lease, where you pay to use it and decide at the end whether to buy, return or upgrade.
How to Get a Business Loan for a Small Business in Grand Forks, ND
- Write down what the money buys and when you need it.
- Pull the last several months of business bank statements and your most recent tax return.
- Check that your entity's state filing is current.
- Call or send the request form; we suggest a structure and explain how a request moves.
- Compare any partner offer by total cost, not just the payment.
Need ideas by trade? Industry pages cover thirteen sectors in Grand Forks County, ND.
