There are many reasons why an alternative lender can be a better option when compared to traditional lenders. The alternative lending process is much quicker. There are flexible credit requirements and also you don’t need to gather nearly as many documents. Alternative lenders additionally provide a variety of funding products so when you have clearly excellent credit score, but fall short of traditional lending requirements, you can get competitive rates and terms. Another good thing is if your FICO score is under 600, you still can get funding from alternative lenders.
If your bad credit is limiting you on getting funding for your business, or you don’t want to deal a lengthy loan application process, then seeking out a small business loan from alternative lenders may be the perfect for you. Here is what you need to have ready to apply for business funding at alternative lenders.
- Your Basic Information
To get a pre-approval, an alternative lender will need to know about you, which include your business name, phone numbers, email address, monthly gross sales, and the amount of money you are requesting to borrow. You can quickly add all your basic information with an online application, and then a loan representative will contact you to go over your funding options.
- Your Bank Statements
The more financial information you can present to a lender, the better. However, most alternative lenders can be happy with at least four months of bank statements. They actually want to realize what your profits are to determine how much amount you qualify for, and that you can be a responsible borrower.
- Your Bank Balance
Similarly to your bank statements, many alternative lenders will need to see your average bank balance. This may reveal them that you are able to manage a positive cash flow and your financial image demonstrates a little bit of cushion in case of emergency.
- Balance Sheet
Alternative lenders don’t require each and every detail of your business financials like traditional banks; however providing a balance sheet can be helpful for them. A balance sheet will simply reveal lenders about how you manage your assets and liabilities. This provides lenders confidence in your potential to pay back them. An average bank balance for most of the lenders will be a couple of months of financial information. However this document is a must have if you are looking for a larger amount of funding for an extended time period.
- Time in Business
There is no need for you to provide official documentation to prove that how long you’ve been running the business; however most of the alternative lenders will need to see how long you have been running. The longer you have been running a business, the more likely you’re to acquire a small business loan. However, most alternative lenders only require you to be in business for some months to be eligible for a small business loan.