Unfortunately, bad credit has precluded a number of business owners and prospective business owners from realizing their dreams of getting their company off the ground and running. According to some stats, fewer than one-third of businesses looking for funding through a traditional banking method were actually approved. So how can you get the cash you need to start or upgrade your business if your credit is less than ideal? Fortunately, we’ve got some options for you to find business loans for bad credit:
It’s unlikely, but there’s a chance you’ll still receive a loan from the bank with bad credit. It’s not a bad place to start, but don’t put your eggs all in this one basket.
If your company deals with customer invoices, and you have a number of them that are currently unpaid, you can use them to apply for invoice financing. This can help you get the cash you need to get your business moving in a timely manner. And time is often of the essence. This is another reason why more and more businesses are avoiding traditional banking; depending on the loan, it can take a bank weeks or even months to grant approval. By that time, your chance might have come and gone.
Most online lenders will give you an opportunity, even if your credit is a bit of an eyesore. And, as with anything else, the higher your credit score, the better the terms of the loan will be. Alternative lending is a great option if you’ve been turned away by the bank, or if you need cash in a hurry to seize a moment.
Credit Cards/Line of Credit
If you’re just starting out, applying for a company credit card or a business line of credit is often a smart way to get the cash you need for one-time purchases. Pay on an as-needed basis, but remember: don’t borrow more than what you need. Overdrawing a loan and having to pay back interest on money you didn’t even use can derail even the most meticulous business plans.
Need some extra cash and have a great rapport with your customers? Then using a grass-roots movement to ask for contributions might be a fantastic option to raise money. As always, help from family and friends is a bonus. If you’re going to pursue this option though, make sure to be open and honest about your needs and your goals. Social media can be a wonderful tool in this endeavor.
Have bad credit? Need a loan? Contact the National Business Capital team today! We’ve got the experience in a number of industries, and the resources to make your business dream a reality. And check out our free ebook on how to get funding when the bank says no. It’ll give you the insight you need to find the financial option that works best for you.