There’s a reason they say, “if it sounds too good to be true, it probably is”. If you have bad credit and are considering a financing option that promises “guaranteed approval” or “no credit check loans”, it’s time to step back and start asking some serious questions.
Loan applications and bad credit do not mix. Trying to find a lender who will let you borrow money with bad credit is a very challenging, frustrating process. It can be tempting to fall into the trap of a “guaranteed” business loan to try and solve your cash flow problems. In truth, there simply is no such thing as a guaranteed approval for bad credit.
How to Safely Weigh Bad Credit Financing Options
No, guaranteed approval is not something you’re going to find. However, there are alternative lenders out there that specialize in offering business owners with bad credit financing options. These viable cash solutions can even help you rebuild your credit score over time. The key is to compare each of these options, and find the lender that understands your business type, industry and current situation.
Here are a few options you should consider before if you need to borrow money with a bad credit score:
In some cases, credit cards can be a good option for your business. Because credit cards are often the easiest type of financing to qualify for, even with credit challenges, it’s worth some research. A small business credit card often requires the borrower to sign a personal guarantee; this is a good thing if your business is suffering from bad credit, but your personal credit is in good standing.
Merchant Cash Advance
A merchant cash advance is not a loan, but a lump sum payment to a business in exchange for an agreed-upon percentage of future credit card and/or debit card sales. Cash advances are offered by alternative online lenders who typically specialize in offeringbusiness owners a merchant cash advance bad credit. The application process is known for being fast and hassle-free, and you can have money in your account in as little as 24 hours.
Another non-traditional option, crowdfunding allows you to launch and manage a campaign for your business. With equity crowdfunding, you offer a percentage of your company to investors in exchange for capital. Reward crowdfunding, on the other hand, involves reaching out to your customer base and convincing them to make small investments in your business.
If you have bad credit, make sure you research all of your options. With a little time and the help of a good provider, you can rebuild your credit score and watch your business thrive.
Author Bio:As the FAM account executive, Michael Hollis has funded millions by using business funding merchant cash advance bad creditsolutions. His experience and extensive knowledge of the industry has made him financeexpert at First American Merchant.