Small Business Loans Bad Credit Options

Anyone who’s ever tried getting approved for a traditional loan from a typical bank knows the lengthy list of stringent requirements that need to be met in order to be approved. And good credit scores happen to be one of them.

Small business owners with bad credit typically experience a number of challenges when trying to get approved for a quick business loan from banks and credit unions. Lenders consider business owners with bad credit a risk, which is why they typically reject loan applications under these circumstances.

Fast and Easy Bad Credit Loan Options

Even if approval is granted, it usually takes weeks to get access to the necessary funds. Getting working capital in these circumstances is a difficult task for small businesses with bad credit. But all is not lost. These days, there are more options than ever when it comes to small business loans and many of them are much faster than traditional financing options.

Business cash advances look at your potential, not credit score

A business cash advance is perfect for small businesses that can’t qualify for a traditional loan because of bad credit. Unlike a typical term loan, the funding amount that you qualify for is based on the amount of your credit card sales. As such, this type of financing option allows your lender to convert your future credit card sales into the capital you need right away.

Automatic repayment is simple with a cash advance. Rather than making fixed payments as in a traditional loan, your repayments are tied to your daily credit card sales. How much you repay each month will be in direct relation to the volume of credit card sales.

During slow months the repayment amount will be lower than during months with higher sales. This set up helps ensure that your capital is never drained.

Business lines of credit are great for the unexpected

Whenever you find yourself faced with an unexpected expense, having a business line of credit in the background can give you the financial relief you require. You can get approved for a certain amount of capital, which you can withdraw from your line of credit fund whenever you need extra cash.

As long as you don’t go over the credit limit, you are free to withdraw as much or as little as you want. The funds can be used for a variety of business purposes, and interest is only charged on the portion withdrawn. No hidden fees other than interest is charged against your available capital.

By applying for a business line of credit before you actually need the money, you’ll be prepared should a time of financial distress hit you at a moment’s notice.

Equipment financing makes you appear less risky

An equipment financing program can be a quick, easy and streamlined solution for financing the value of all the equipment you need. Whether your business requires computers, vehicles, printing equipment or kitchen appliances, equipment financing can help you afford these expensive purchases.

The equipment itself collateralizes the loan, so you don’t have to come up with any collateral yourself, nor do you have to provide proof of credit. The loan is typically made at fixed interest rates, along with a fixed term length so your monthly payments are consistent.

Invoice financing is perfect for financing overdue payments

Many businesses may experience a delay between invoices and payments received. Not only can this be very frustrating, it can also put you in a financial predicament. That money you’re waiting for is needed to pay for things such as equipment, payroll, repairs, and any other expense related to your business.

Invoice financing is designed to help alleviate this dilemma. With this program, your lender essentially buys your invoices, after which they’ll advance you approximately 85 percent of the entire value of the invoices sold. The remainder of the value is held in reserve, from which your lender will collect their initial fee.

A factor fee will then be charged, which will depend on when the invoice is finally paid. You then get the reserve amount, with the total fees deducted, after the customer’s invoice is paid. Your invoices serve as collateral, and bad credit is OK.

Choosing the Right Bad Credit Loan Option is Easy

With so many options available for small business owners with bad credit, deciding which program is right for you can be a daunting task. At Credibly, we can provide you with sound information about your options, and help guide you in the right direction to make sure your decision is the right one for you.

For bad credit small business funding solutions, contact Credibly today! Or to get started now, submit our online pre-qualification request form. It’s free and easy and won’t hurt your credit.