If you have low a credit score, then be assured you aren’t alone. In fact, nearly one-third of U.S. adults have a credit score under 601, and the proportion is rising each year. With such a large population of U.S. adults having low credit scores, you’d think that banks would be more accommodating of small business owners with low credit.
However, if you have less than perfect credit, banks will likely deny your application for a loan, which makes it difficult to get a business funding when you need money most. So if you’ve found yourself in a similar situation, keep reading and find out how to get a business loan with low credit.
First off, let’s shed light on why banks are uninterested — to put it mildly — in helping honest and hardworking business owners like you get a business loan with a low credit score. Contrary to what they say or what you’ve been led to believe, it’s not necessarily because you’re deemed a “high risk borrower.” Banks take risks all the time, and they don’t always reap a reward. Think of condos that take years longer to build, or multi-million dollar loans to enterprises that end up shutting down. In both these projects, the bank is taking on a significant amount of risk. In spite of this, the notion that banks are all about financial safety and security is part of their brand.
In light of the above, we shouldn’t need to write an article entitled “how to get a business loan with low credit?” — because it shouldn’t be such a widespread problem. The fact is that banks don’t want to give out small business loans, because the costs to underwrite a loan for $50,000 are equal to those for $2,000,000. With the same costs associated with evaluating collateral and assessing paperwork, it’s no surprise that a bank would rather underwrite high value loans. Because banks couldn’t say this outright, they ratcheted up their requirements and started preaching about the virtue of making safe investments.
So, if the answer to “how to get a business loan without credit” is NOT “head to your friendly neighborhood bank,” then what options do have? Fortunately, you have plenty of choice!
At National Business Capital, we regularly approve clients with low credit scores for business loans, lines of credit, equipment financing and more. Why? Because we know — just as you do — that a credit score is not the end-all-and-be-all of a person’s credit worthiness or a business’s profit potential. What matters isn’t what happened in the past, but rather what’s happening now, and what is likely to happen in the future with a timely and appropriate infusion of working capital.
The bottom line? You know that your business is on-track for success. But to continue heading upwards and onwards, you need to overcome a temporary capital shortfall, or make strategic long-term investments or acquisitions. Whatever the reason, the answer to your question “how to get a business loan with low credit?” is simply: contact National Business Capital today. One call, and there’s a very good chance that you’ll have the best night’s sleep in ages! Or, fill out our two-minute application, and we’ll help you find a loan option that’s right for your business.
Also, be sure to check out our FREE eBook on how to get business funding when banks say no: