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Understanding your business loan rate When shopping around for a business loan, you’re going to be presented with a number of different rates. There’s no standard way that business loans are presented, so it’s left to the business owner to figure out what everything means. At StreetShares, we want you to get a fair deal... Example comparison Offer: $10,000, 1-Year Loan, $325 Origination Charge 8% Interest rate 14.6% Annual percentage rate (APR) 4.1% Factor rate = Common rates and what they mean Interest rate The annual interest rate that you’ll pay on the remaining principal of your loan. DOES NOT include other costs, such as origination fee. Annual percentage rate The annualized total rate you’ll pay on your loan. DOES include all costs, such as interest and any other fees. Factor rate The total cost of borrowing, divided by the loan amount. This is NOT an interest rate and DOES NOT account for time. “Loan fee” Some lenders will say that they charge a fee instead of interest. Similar to factor rate, these “fees” aren’t annualized rates. Here’s a quick guide to help you understand and compare your loan offer: = Have more questions? Call our funding experts at 1-800-560-1435 Below are the rates associated with the above offer. As a borrower, you could be presented with any of the following rates. While they appear very different, that’s not the case.
