When it comes to securing capital for your business, regardless of the reason, often times a bank will decline you for a loan. It is common knowledge that banks decline over 80% of businesses looking for financing. New regulations and outdated underwriting has restricted the number of approvals especially within the last 5 years. Alternative business financing has quickly become the fastest growing sector of business financing in the country.
Alternative lenders are individuals or private companies that provide alternative business financing. One such company is Small Business Funding. This is a one stop shop for any business owner to go to if they are in need of fast capital and have been turned down by a bank.
What to Expect From Alternative Business Financing
Alternative business financing can provide fast financing, in as little as 7 days, fast approvals (24 hours), and emergency cash when you need it. Often, a single page application is all that is needed plus 3-6 months of bank statements and some merchant statements (only if you process credit cards). With this information in hand lenders can underwrite your approval or denial in 24 hours or less. It is the speed of funding and ease of applying that makes this a viable alternative for business owners seeking financing. Alternative business financing provides needed capital for those owners with less than perfect credit, have only been in business 3 years or less, or need fast capital in less than a week. With this fast and hassle free alternative business financing comes higher fees and shorter repayment terms. On average a business owner who receives alternative business financing should expect to pay between 20% and 50%, depending on credit and type of industry, over a 12 month term or less. Often, the repayment term is about 7 months. These repayments are daily. That’s correct. Daily payments taken out of your bank account or held back on your credit sales. These are most commonly called merchant cash advances or unsecured revenue based loans.
Making the Most of Your Assets
There are other types of alternative business financing. These are factoring, which has been around the longest, and asset based lending. Both tend to be lower rates and longer terms. Factoring is a prepayment on your accounts receivable up to say 70-90%. At which point your client pays you the lender will repay themselves plus 3-5% fee. This is more of a line of credit as well because not every month you will need to borrow. rather when you do a larger job with a client that needs 30-90 days to pay, then you would use a factor to help you with cash flow. Asset based loans are collateralized with equipment, real estate, inventory, etc…. something tangible that has value to others.
Funding is Available for You
Regardless of what type of alternative business financing you use, the point is that there is capital available to you if your bank turns you down for a loan. Small Business Funding has relationships with the top alternative lenders. They can navigate through the process on your behalf to find the best suited financing package to meet your needs all in 7 days or less. Whether its for an expansion, maintenance to equipment, purchasing new equipment, new hires, buying an additional franchise, or for working capital small business funding will secure the alternative business financing you need. To see how much alternative business financing you can be approved for click here or call direct at 1-800-742-2995