This page lays out the six funding types Fieldhaven Business Funding handles for Valparaiso, Indiana owners: lines of credit, term loans, equipment financing, working capital, inventory financing and merchant cash advances. It answers what a business loan can pay for, term loan versus line of credit, the four loan families, equipment leases versus loans, secured versus unsecured debt and advances versus loans.
At a glance
- Employer establishments, Porter County, IN
3,734 (County Business Patterns 2023)
- Employers with fewer than five employees
51.1% (County Business Patterns 2023)
- Businesses without paid employees
11,955 (Nonemployer Statistics 2024)
What Can You Use a Business Loan For, Funding Type by Funding Type?
| Funding type | Bills it covers | How it is paid back or collected |
|---|---|---|
| Business line of credit | Bills that recur before customers pay: wages, fuel, materials | Interest on the drawn balance; each payment frees that much of the limit again |
| Term loan | A partner buyout, a business purchase, a build-out | Equal payments over a set number of months |
| Equipment financing | Mowers, lifts, ovens, press brakes, imaging units | Fixed payments; the item secures the loan or stays the lessor's |
| Working capital | One gap: a large order, a remodel month, a slow-paying account | A short schedule, sometimes with weekly or daily debits |
| Inventory financing | Store stock, parts, grocery orders bought before they sell | Reduced as each item sells, or by fixed dates |
| Merchant cash advance | Any business need, sold against future card receipts | The provider keeps a slice of card sales until the agreed sum is reached; this is not a loan |
The table answers the question by the bill, not by the label on the product. An owner who starts from the bill and its payback source can rule out several of the six in a minute, which leaves a short comparison of real offers.
Term Loan vs Line of Credit for the Same Porter County, IN Bill
A term loan suits a cost that happens once: the full amount is paid out on day one, and interest runs on all of it until the schedule ends. A line suits costs that come back: the owner draws only what a given week needs and pays interest only on that balance. The price per dollar, any draw fee and any annual fee can differ between the two, so the comparison is total dollars on the owner's real pattern of use.
Illustration only, invented figures: a $120,000 term loan at an invented 10.5% over 72 months carries a payment of about $2,253 a month and about $42,250 of interest across the term (our arithmetic). An invented line with the same limit that averages a quarter of it drawn charges interest on that quarter only, which is the reason the drawing pattern decides the comparison.
What Are the Four Types of Business Loans Bank Lenders Group Together?
Banks and credit unions sort business lending into four families: term loans for a stated purpose paid on a schedule, lines of credit drawn and paid down, equipment loans secured by the machine or vehicle they buy, and commercial real estate loans for buying or building property. Fieldhaven does not arrange the fourth. Specialty funders add working capital loans read mainly from bank deposits, inventory financing secured by stock, and merchant cash advances, which are purchases of future card receipts rather than loans.
Equipment Lease vs Loan for a Machine With a Long Working Life
With a loan, the business owns the machine from the start and the funder holds a lien until the last payment. With a lease, the lessor owns it and the business pays to use it, sometimes with a purchase option at the end. Illustration only, invented figures: a $46,000 commercial mower package financed with $4,600 down over 48 months at an invented 9% costs about $1,030 a month (our arithmetic), and the business keeps the machines at the end.
An invented 48-month lease at $1,090 a month with a $1 buyout totals $52,321 (our arithmetic). Whether that beats the loan depends on how long the machines will stay in service and what they would sell for later. The equipment financing page covers both structures by trade.
Secured vs Unsecured Business Loan: What a Funder Can Claim
A secured loan names collateral the funder can take if payments stop: the machine behind an equipment loan, receivables or stock behind an asset-based line, sometimes a blanket lien on all business assets. An unsecured loan names no single asset, though it can still carry a personal guarantee that reaches the owner's own property.
- List every asset the security clause covers, in plain words.
- Ask whether a personal guarantee is included and how far it reaches.
- Ask whether a financing statement will be filed with the Indiana Secretary of State and what it describes.
- Find out what paying the loan off early releases and whether it costs extra.
Merchant Cash Advance vs Loan: A Sale of Receipts Against a Debt With a Schedule
A loan has a principal, an interest rate and a schedule that runs whether sales are strong or weak. A merchant cash advance has none of those: a provider buys a share of future card receipts at a discount and collects that share as receipts settle, until an agreed total is reached. Because the cost is set by a factor and not an annual rate, the fair comparison sets the total remitted beside the full dollar cost of a loan for the same need. The merchant cash advance page works one through.
How a request moves covers the steps after choosing, and the trade pages show which types each Porter County, IN industry compares first.
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