Both commercial and consumer finance companies may lend you money to start your business. Commercial finance companies arrange business loans. On the other hand, personal loans are made by consumer finance companies. Both types of finance companies tend to lend money to people that banks may turn down. Because they take greater risks, finance companies usually charge high interest rates.
Some people borrow money against their life insurance policies.
This is an easy way to obtain some of the money needed to start a business. Since life insurance policy loans are based on the cash already paid in, they are not risky. Life insurance companies usually offer these loans at lower interest rates. However, it should be remembered that the amount borrowed is deducted from the coverage available to the beneficiaries until the loan is repaid. If you need to buy land or a building for a new business, you may be able to borrow the money from a savings and loan institution.