Securing a commercial loan is often a necessary component for startups and small businesses to grow. There are many ways to go about doing so, including bank financing, term loans, lines of credit (including revolving lines of credit), and venture capital. Whichever way you decide on, having the help of an M&A attorney in Miami is not a bad idea. 

Bank financing is what is referred to typically as a traditional loan. This is where the bank authorizes the business to loan a fixed amount of money, and the business gives their word that they will pay it back over time. Businesses typically need to offer collateral to secure the loan. Common examples include inventory, real estate, or accounts payable. 

Term loans need to be repaid over equal periodic installments either in annual or monthly form. Installments can include both the principal loan amount and the accrued interest rate. Not all term loans offer installments. The full amount, including the principal amount and loan interest accrued, may be paid at the end of a specified period.

Lines of credit are non-binding commitments to a bank for occasional loan money as a company may need it. This means money loaned may be repaid during a specified time frame, and because the commitment is nonbinding, banks may cut off the lines of credit when they deem it necessary. 

Venture capitalists are referred to as firms that invest money in companies hoping they will bring in a profit in the future. Venture capital firms give money to a business in exchange for partial ownership of the company that received funding. Venture capital is much like making a securities offering since a company is, in essence, trading part of its equity for funding. However, venture capitalists work directly with the company and have some say in operations. 

If you are considering or already have used any of the above for financing your company, a corporate law firm in Miami can help you through the process, help with the confusing paperwork and terminology associated, and can be there to help solve any disputes.