Getting a business loan with bad credit is far from easy. Many banks overlook smaller struggling businesses because they feel it’s more risk to them than what it’s worth. However, if you’re a bad credit business owner looking for a break, securing a loan isn’t impossible regardless of how bad of a situation your business is in. Take a look at some of your many options below that will give you the best chance of securing that much-needed loan to keep your business afloat.
Traditional Bank Loan
Most banking institutes would be happy to work with your business if it’s the right move for them. If they can see that your business is just going through a bad spell and you haven’t been able to keep up with payments in recent months, they could be the best option. Of course, banks have become much stricter in terms of whom they lend to today, but it’s always worth having a look at your options, especially if you have a good personal credit history and you’ve been banking with them for a long time. You may face higher interest rates than other options and might require more collateral to secure the loan, but it’s worth looking at if you’re really struggling and you feel a bank loan would suit your business in its current financial state.
A Microloan Could Be Your Best Option
A microloan is a good alternative if your business has had problems keeping on top of its finances in the past. However, because microloans are generally provided by local credit unions, it’s not easy to secure a loan of more than $50,000. This might not be a problem if you’re only a small business looking to keep afloat, but for businesses looking to acquire new property or vehicles to expand, it’s not always useful. A microloan works very much in the same way as a traditional bank loan would but it is much easier to get accepted for because the loan amounts available aren’t anywhere near as high.
Unsecured Business Loans
Online businesses like www.excelcapmanagement.com offer unsecured business loans for small to medium-sized businesses. Such services pride themselves on being able to offer loans to businesses, regardless of the situation they are in. They don’t just look at your turnover – they look at everything from your business model to the industry you serve, giving your business a much higher chance of being approved for a loan.
Cash Advance
Many business owners overlook cash advance business loans because of the high-interest rates involved. Cash advances only provide smaller loans of $10,000 or less, so they aren’t that handy for businesses deep in debt. However, if you’re looking for a quick loan to keep your business running for several months, a cash advance could well be the perfect option.
The above business loan options are just some of the many available. If you’re that desperate to secure a loan you could even go as far as offering your own personal assets as collateral. This would be the last option if the above didn’t work out. However, if you’re struggling and you believe your business will be in a better place because of it, there’s no reason why you shouldn’t consider it.