Canyonwick Finance, a small-business funding broker in New Braunfels, TX, compares six options here: working capital, term loans, lines of credit, inventory financing, equipment financing and merchant cash advances. The right one depends on what the money buys and how your revenue arrives. Lending partners, not Canyonwick, decide and price every offer.
All six options in one table
| Option | Typical purpose | How it comes back | What usually secures it |
|---|---|---|---|
| Working capital | Wages, rent and supplier bills during a cash gap | Short-term installments on a fixed schedule | A business lien, often a personal guarantee |
| Term loan | Build-outs, relocations, a second site, refinancing | Scheduled installments over a longer term | Business assets, sometimes real estate |
| Line of credit | Uneven or repeating costs | Interest on what is drawn; the limit refills as you repay | Varies: receivables, a blanket lien or none |
| Inventory financing | Stock bought ahead of sales | Paid down as the goods sell, or on a set schedule | The inventory itself |
| Equipment financing | Excavators, trucks, kitchen lines and clinical gear | Monthly payments matched to the asset's useful life | The equipment |
| Merchant cash advance | Short needs for card-heavy businesses | A share of daily sales or deposits until the purchased amount is collected (not a loan) | Future receivables |
Short money versus long money
The quickest way to narrow the list is to compare the life of the need with the life of the funding. Money that covers payroll for six weeks should not still be on the books three years later, and a machine that will dig foundations for a decade should not be paid off in a few months out of operating cash. Short needs point to working capital, a credit line or, in limited cases, an advance. Long-lived purchases point to a term loan or equipment financing.
Matching the two keeps the payment in proportion to the benefit. When the funding outlives the purpose, you pay interest on something already used up. When it ends too soon, the payment crowds out wages and stock.
Secured or unsecured
Secured funding is tied to collateral that the partner can claim if payments stop, such as equipment, inventory or receivables. Unsecured funding has no specific asset pledged, but it is rarely free of obligations: many partners still file a general lien on business assets and ask the owner to sign a personal guarantee. Read the security section of any offer before the payment section. It tells you what is at risk if the business has a bad stretch.
Where SBA-backed loans fit
Searches for SBA loans in Texas are common, and owners often ask us about them. Canyonwick Finance is not an SBA lender and does not arrange SBA-backed loans. Lenders that take part in SBA programs make those decisions themselves. The SBA San Antonio District Office (sba.gov/district/san-antonio) can point you toward participating lenders and free counseling.
What partners look at first
Criteria differ by partner and by product, but the first questions are similar across all six options:
- How long the business has operated and in what form (sole proprietor, LLC, corporation).
- Recent business bank statements, which show deposits, balances and existing payments.
- Revenue and profit, from tax returns or financial statements.
- Existing debt and any advances still being collected.
- Owner credit history, for most products.
- For equipment or inventory, a quote, invoice or stock report.
Getting these together before the first call speeds up every conversation that follows. Free local help can review statements and projections with you at no charge.
Using a business loan for different purposes
A business loan can pay for nearly any legitimate business purpose: equipment, stock, wages, a lease deposit, a remodel or paying off costlier debt. What partners care about is that the purpose and the repayment source make sense together. A loan to buy inventory that turns over in sixty days has an obvious repayment source; a loan to cover months of losses does not. Personal spending is not a business purpose, and most agreements restrict how funds may be used, so read that clause.
Card or credit line?
Many owners already carry a business credit card and wonder whether a line of credit adds anything. The short version: a card suits small, frequent purchases that are paid off each month; a line of credit suits larger draws such as payroll or a supplier deposit that take a few months to repay. Our card-versus-line comparison works through the mechanics.
By Canyonwick Finance · Updated