Cash flow needs: Generally, floating interest rate products require lower (anywhere between 50 to 75 basis points) initial payments than fixed rate products. This frees up cash flow for startup companies or other businesses with large initial costs or breakeven periods like franchises or security services. Businesses like hotels and restaurants that have large initial capital outlay should also take floating rate loans.

Fixed rate products provide more capital support for needs like expansion plans or refinancing, especially in a rising interest rate environment. Businesses with low initial outlay like real estate brokerage and advisory business require consistent money for marketing and payroll expenses should apply for fixed rate products as well.

Time horizon: The owner needs to consider how long they want to keep the business, their exit strategy and the types of improvements they can make to increase the business valuation. This will help them choose a product based on prepayment penalties. For example, a loan may have three years of prepayment penalties. If somebody is planning to refinance or sell a business within three years, they will have to pay the penalty. Other product lines like conventional commercial asset-backed loans may provide a longer fixed rate term and prepayment penalty period.