Let’s face it, the economy isn’t what it used to be, and small businesses are suffering. According to a business start-up source, small business failure rates are at a mind-boggling 85 percent within the first year of start-up. That vital first year of opening the doors will typically face the most challenges — business owners are testing the waters to determine what works and what doesn’t work. Unfortunately, even those of us with the best intensions and education to back them, fall prey to hard economic times. As a result, we can make business-saving decisions that ultimately harm our credit scores.
In that vital first year of business, it is common for entrepreneurs to turn to small business loans in order to stay above water. But often large banks close their doors if your credit is less than perfect. What is a business owner to do?
Finding the Right Lender
If you have a damaged credit score and are on the brinks of closing your doors there is a bad credit business loan that is right for you and that fits your unique situation. Taking out a loan from an alternative lender versus a large bank has many benefits that cater to small businesses.
Unlike traditional bank loans, taking out a business loan on a line of credit from an alternative lender offers amazing flexibility that you won’t find with a larger institution grounded on strict and often impossible guidelines to follow. You can use the funds in any way you want without a bank looking over your shoulder and dictating rules. Furthermore, you control the loan in that credit lines can be used at your discretion and timing.
We have all heard the expression “time is of the essence”, and when it comes to taking out a business loan this old saying holds current meaning in a big way. Unforeseen inconveniences can take place that can ultimately ruin a business unless the matter is immediately resolved. Imagine you own a successful t-shirt printing business, and your screen printer breaks down and needs to be replaced with a brand new machine. Every hour that passes you are losing money and customers to your competition. It can take a week or more for a big bank to approve a loan. However, almost all alternative lenders can approve your loan and provide you with funds within 24-48 hours.
Using Your Head
Alternative business loans are, simply put, a smart way to go about saving your business. There is no risk on your part by providing a personal guarantee, and you don’t have to have collateral. In other words, there is no need to put your house up to back the loan. Furthermore, you can have really bad credit and alternative lenders still value you and your business as being an investment worth saving.
Check for Yourself
By doing some simple online research and learning the terms and conditions imbedded within both traditional and alternative business loans, you will clearly see which option is best for you.