What are the required qualifications to get a delayed draw term loan?

You can expect to be asked for things such as your business history, business financials, legal structure, business and possibly personal credit, and loan purpose among other things, your lender will be able to guide this part of the process.

Is collateral needed to get a delayed long term loan?

This will depend on the terms of your loan from your lender. While it may be possible to have an unsecured loan, the lender may want to protect themselves and ask for owners to offer some form of recourse before lending.

What are the fees and interest rates associated with a DDTL?

Fees associated with a DDTL include ticketing fees, which are fees associated with each draw down of a DDTL. Similar to traditional loans, your open balance will accrue interest. 

How long does it typically take to receive funds from a DDTL?

This will vary depending on your lender. Given the nature of a DDTL the owner will need to request to draw, then the process for proceeds to move to the borrower will take place, which will cause some delay and feel less immediate.

About the Author

Kal Salem

Kal Salem

MA Accounting - Arizona State University

A CPA and finance professional working with small businesses to educate owners and grow alongside their businesses. Kal started his career in public accounting supporting SEC, regulatory, and both internal and external audits. He holds a Masters in Accounting and a BS in Supply Chain Management. Owner at Salem CPA...

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