Business Loans for Bad Credit
According to Forbes.com, a whopping 8 out of 10 businesses fail within the first year and a half. Why is this number so high? There are a variety of factors that may contribute to the failure of a small business, but one of the biggest factors is funding – without capital, a small business cannot grow, and without growth, the business cannot survive. Unfortunately, many small businesses struggle to get the small business funding they need due to poor credit.
Business Loan Options for Bad Credit
Securing business loans for bad credit can be a challenge, but it is not impossible – there are several options worth trying. One option you may want to look into is Small Business Administration (SBA) loans. These loans are government-guaranteed, so it is more likely that lenders will accept a business with less than stellar credit – you also have the option to select a particular lender that suits your situation. Before you apply, research the particular lender you will be contacting and plan your presentation carefully to show your business in the best light possible.
Another option is a business cash advance – this option is best if you only need a few thousand dollars. This type of loan is based on your monthly income so, if you can prove a monthly income of $2,500 or more, you may be able to get a cash advance of as much as $10,000. A third option is to obtain a microloan from an independent lender. Lenders for microloans are typically more lenient in terms of credit, which makes this option popular among small businesses with bad credit.
Tips for Improving Your Success Rate
Even if you have excellent credit, there is still a chance that your request for a loan will be denied. In order to improve your chances of succeeding in securing business loans for bad credit, you may need to take some extra measures. Follow the tips below to increase your chances of being approved for a loan: