Term Loan

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Term Loans are the monetary loans provided for a fixed period of time to be repaid at regular intervals. Rate of Interest of such loans are either fixed or on floating basis. Term Loans are usually availed to purchase the fixed assets for the company in the forms of heavy plant and machinery or any building or plot.

Features:
  • The interest that the borrower pays on the term loan is tax deductible and hence can avail tax benefit on the interest paid
  • The term loans are negotiable and hence the terms and conditions of the loan are not rigid
  • The term loans represent debt financing and the interest of the equity shareholder is not weakened.
  • Term loans can be converted into equity according to the terms and conditions that have been laid out by the lender
  • Financial institutions impose a penalty on the defaults.
  • The term loan’s maturity lies between 5 -10 years. The repayment of the loan is made in installments. The tenure can be rescheduled to help borrowers deal with the financial emergencies.

Easethebiz.com can help you in preparing the project reports to be submitted with banks for applying any type of term loan and obtain sanction of term loans for the business.