If you are in process of opening up your first small business, you no doubt need start-up capital to make it happen. For many entrepreneurs, a small business loan won’t mean a massive amount of money. But for a business that is just getting on its feet, it can be a little intimidating to pay all of this money back. It is in the interest of the business to pay the payments back as soon as possible. A good lending company won’t charge a business for early repayment (that’s always a good piece of policy to check), but a small business might struggle to make early payments. Fortunately, there are ways that the average business can make this happen.

For the most part, these methods will mirror the techniques that individuals would use to pay off their personal debt. As with all debts, the reason business lending is so expensive for the small business is interest and fees. These charges add thousands to the balance of the loan by the time the whole loan has been repaid. If a business was able to pay off a loan instantly, they’d have borrowed money for free. On the other hand, if they were able to pay off a small business loan instantly, they wouldn’t have needed the loan in the first place.

The trick is to have your business finances in a good place before requesting a loan. Many businesses request loans out of financial desperation. Sometimes this can’t be avoided. A loan can save a business and keep it from closing. In all other cases, though, it is advisable to get a loan only when you could afford to pay it back early. This doesn’t mean you will pay it back early, necessarily, but the extra cash flow you’re counting on will act as a buffer against business problems that could keep you from paying back the loan.

Another time to take out a business loan and get it paid back fast is when you are in process of entering into a new plateau of business success. In a situation where you may be poised to dominate a larger market share or take on a bunch of new customers, your loan could fuel a new enterprise which could bring a lot more money into your business. A lot of businesses take out a loan in a moment of business crisis. This is not the best thing to do. The loan might not be sufficient to correct the crisis. If the crisis ends in failure and you are not able to repay your small business loan, the whole ordeal will likely end in bankruptcy.

Businesses need to take out loans only when they are in the right place to do so. Taking out a loan at the right time can boost business to new levels, making it easy to pay the money back on time so as to incur the least amount of interest and fees possible. Not every business will be on the verge of great new success, but even these should only take out loans when they have enough cash flow to pay the loan back faster than the minimum payment would require.

Looking for finance? SmallBusiness.co.uk is working in partnership with trusted lenders to find the best business funding deals. Find out more here.