Credit scores are the visual presentation of small businesses, and having a wrong score can make the difference in getting a business loan easily. Getting a business loan can be a serious struggle if you have a bad credit score on your side.

Barriers for Bad Credit Small Business Loans

Traditional lenders and banks are continually reducing the lending risk factor. Lending money to bad credit businesses is the last thing they want. In current stringent economic conditions, credit score has become an essential element for evaluating the borrower’s risk while lending. Getting a small business loan has its own exclusive challenge, tight funding criteria has put financial institutions even more on guard. Still, a bad credit score doesn’t mean your business can’t get a small business loan.

How to Get a Bad Credit Small Business Loan?

The usual trend for bad credit borrowers is that they have to pay very high interest rate in order to get a business loan. By charging higher interest rate, lenders minimize their risks.  The best way to avoid stringent requirements and high interest rate is to approach an online lender, which is usually considered as a microlender. With a microlender, a business can easily get a microloan with bad credit ranges from ($5,000-$25,000) and can improve your credit ratings by repaying it timely. Such “Non-bank” lenders gladly help bad credit businesses with an arrangement called a bad credit business loan and also report the payments to credit bureaus.

Which Lending Option Helps: Alternative OR Traditional

If you have an atypical business idea or jumping into a high risky industry, you should need to consider alternative lending, as traditional lenders are reluctant to lend to anything they considered risky.

Rebuilding the credit score of your business is the best approach to avoid a high-risk business loan arrangement, and you can build your credit score better anytime.

Bad Credit Small Business Loans

The loan options at Merchant Advisors include bad credit small business loans for small businesses in need of quick working capital. Regardless of bad credit, Merchant Advisors business loans feature trouble-free paperwork, no loan application fee, flexible repayment plans, multiple credit options and absolutely no requirement of collateral or personal guarantees.

However, if a standard business loan can’t fulfill your small business financing needs, our merchant cash advance can be a more preferable funding option. Rather counting on business credit scores to estimate a business’s repayment capability, cash advance option provides the much needed funding in exchange for a percentage of your future credit/debit card sales. This way your small business can easily avail the needed capital and repay the loan based on your future consumer transactions instead of your credit score.

Contact Merchant Advisors today to discover your financing options for bad credit small business loans.