Are you planning to take out a business loan, but feeling overwhelmed by all the jargon? Don’t worry, we’ve got you covered!

Here are the most commonly used lending terms you need to know:

APR (Annual Percentage Rate): The total cost of borrowing, including interest and fees, expressed as a yearly rate.

Interest Rate: The percentage of the loan amount that you’ll pay as interest over a set period of time.

FICO Score: A three-digit number that represents your creditworthiness, ranging from 300-850. A higher score means better credit.

Credit Report: A detailed report of your credit history, including your payment history, credit limits, and outstanding balances.

Collateral: An asset that secures a loan, such as a car or property. If you default, the lender can take possession of the collateral.

Repayment Term: The length of time you have to pay back the loan.

Amortization: The process of gradually paying off a loan through regular installments.

Principal: The initial amount borrowed or the amount still owed on a loan.

Interest: The fee charged for borrowing money, calculated as a percentage of the principal.

Prepayment Penalty: A fee charged for paying off a loan early.

Now that you’re familiar with these terms, you’ll be able to navigate the lending world like a pro! Remember to always read the fine print and ask questions before signing any loan agreements. Reach out to us at Golden Capital Solutions for any of your commercial lending needs!

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