Bad credit has become a common plight due to the economic crunch. Therefore, it is not easy to acquire business loans with bad credit. Many Small business owners manage to setup their startups. But then maintenance, growth and sustainability asks for more cash to be invested in it that is when bad credit prevents them from acquiring the right amount of loan for their small business.
With poor credit history many business owners end up hearing a ‘NO’ from funding companies and banks. It so happens that if you have high score, funding options will be numerous. But if your credit score is low or non-existent, then funding options remain limited.
Ditch the Banks
Banks and other financing resources support a minute percentage of total funding need. 90 per cent of the time they completely ignore the funding request. It is also believed that these particular funding sources account for only 25 percent funding, due to which business owners have to acquire the remaining 75 percent from other funding resources.
Businesses with bad credit are often charged with higher interest rates in form of compensation from the borrower. Some small business owners with bad credit score often opt for home equity line of credit. In which banks keep your house, in case of default, in exchange for the money you have borrowed.
Friends and Relatives Funding
Some business owners attempt on minimizing the risk by acquiring business loans from their friends and relatives. This funding option is the easiest to come by as it offers no risk.
Keep an eye on gifts and grants offered by the government institutions. Many government organizations offer grants for small business owners. You need to research and find the best suitable government grant for yourself. There are varied grants for different types of businesses.
Bad credit among small business is common, without credit some small businesses just die away hence Merchant Advisors and other such lenders become the best suitable option. They not only provide loans to businesses with bad credit but also to small business owners who are in restaurant business, franchise opening, retail business, minority businesses and also to business which need to buy equipment for restaurants.
With them it does not matter if you have bad or poor credit, loan application does not require collateral and funding can be acquired in just 5 days. A dedicated advisor helps you in meeting your loan needs and helps you in completing the entire process.