Regular business loans are great and all, but what if you’ve got bad credit? Does that mean you’re out of luck?
No! There are ways to get funding even if your credit isn’t great (or even good) right now.
To help you get started, here’s a little bit about three types of bad credit business loans.
1. Merchant Cash Advance
With this type of funding, you agree to give the lender part of your daily income. They provide you with the funds you need to operate your business.
In exchange, you give them a percentage of your daily sales. You’ll likely need to pay a fee on top of that percentage, too.
This is something like a loan, but also not a loan. So it works well when you have bad credit.
2. Alternative Lender
While a bank may be your first thought, there are many alternative lenders available who’ll offer you financing when you have bad credit. Companies like Small Business Funding have options that banks simply don’t offer.
These types of loans are meant to work with many different types of businesses. So you’ll be able to find one that’s perfect for your situation. These types of loans can often be secured very quickly.
Somewhat similar to a merchant cash advance, factoring gets you the funds you need for your business when you need it. Factoring, though, is used more often by companies who have to wait to receive funds from clients.
In this situation, the company actually purchases your invoices. They give you the bulk of the amount that’s owed. When the client pays up, you send the money owed to the factoring company and they get to keep the overage.
The factoring company will receive around 20% of the money you receive from your invoices.
Bad Credit Business Loans Can Help Today
If you’ve got dreams for your business but have bad credit, no need to fret. There are bad credit business loans that can help you achieve your goals.
Each one of these types of funding applies to different situations, so choose the one that’s the best fit for you. Once you’ve found the right direction, you’ll be on the road to making those business dreams come true!
Curious about how alternative funding is helping women? Click here to read all about it.