🔄 What Is Business Debt Consolidation?

Business debt consolidation means combining multiple existing debts into a single, streamlined loan—typically with better rates and terms.

Popular consolidation options include:

• ✅ Term Loans

• ✅ Business Lines of Credit

📉 How Debt Consolidation Saves You Money

Here’s how consolidation can benefit your business:

• 💳 Lower Interest Rates: Better than credit cards or merchant cash advances

• 📆 Longer Repayment Terms: Smaller monthly payments

• 📈 Improved Cash Flow: More room in your budget

• 🧾 Simplified Accounting: Just one lender and one payment

💰 Option 1: Use a Term Loan for Debt Consolidation

A term loan gives you a lump sum to pay off existing debts, repaid over time with a fixed rate.

✅ Advantages:

• 📉 Lower interest rate

• 📊 Fixed monthly payments

• 🧾 Predictable cost structure

• 🏦 May improve business credit

⚠️ Disadvantages:

• 🔐 May require collateral

• 📋 Borrower qualifications apply

• 🧾 Possible origination or closing fees

🔁 Option 2: Use a Business Line of Credit

A business line of credit provides flexible access to capital, letting you draw funds as needed to pay off debts.

✅ Advantages:

• 🔁 Reusable revolving credit

• 💰 Pay only for what you use

• 📈 Helps manage ongoing cash flow

• 🧾 No fixed payment schedule

⚠️ Disadvantages:

• 💳 Variable interest rates

• 📋 Renewal or review requirements

• 🧾 Requires disciplined use

⚖️ Term Loan vs. Line of Credit: Quick Comparison