The last 10 years have brought a major change in the field of business funding, especially for those who have had problems with bad credit. Bad credit business owners, who were deprived of chances to get financing for their business, today, have a number of opportunities to get access to working capital. Thanks to modern payment processors, problems associated with bad credit are left in the past.
Securing a Business Loan with Bad Credit
Operating a business with poor credit scores creates challenges for entrepreneurs. This, of course, has its negative impact on the growth of a company. Bad credit is generally defined as a credit score between the most famous FICO scores 300 and 629. Anything below 630 makes it troubling for business owners to obtain a small business loan.
To avoid problems when applying for a bad credit merchant account, turn to a reputable credit card processing company. The right payment processing specialist will offer you the best merchant account services tailored to your own business needs. Bad or even no credit isn’t a problem for respectable payment processors.
Loan Options for Entrepreneurs with Bad Credit
Are you interested in a bad credit business loan? Here are the best loan options for entrepreneurs with bad credit?
- Business Line of Credit
Tough business lines of credit are more associated with traditional banks, alternative lenders also offer smaller, shorter, and more accessible lines of credit. As a rule, you should have been in business for at least 6 months and $50.000 in annual revenue. You can get approval in as little as 1 day.
- Invoice Financing
Thanks to invoice financing, you can free up capital when you have slow cash flow because of unpaid invoices. With lenders offering invoice financing, your invoices can be turned into immediate cash. Such lenders don’t avoid working with borrowers with credit scores in the 500s.
- Merchant Cash Advances
Many entrepreneurs with bad credit looking for a quick business funding solution very often take advantage of a merchant cash advance (MCA). This type of business financing has recently become highly popular among merchants. MCAs are funds that are available to businesses for a portion of the sales in future.
- Short-Term Loans
Short-term loans are like traditional term loans. You’re provided with a lump sum loan that should be paid back with fixed payments over a predetermined period of time. Lenders offering short-term loans don’t avoid working with borrowers with a FICO score of 550.
Though bad credit makes it challenging for business owners to get approved for business funding, a reputable business financing provider can help you get the best for your financial needs.
Author Bio: Electronic payments expert, Blair Thomas, co-founded eMerchantBroker in 2010. His passions include writing/producing music, and travel. eMerchantBroker is America’s No. bad credit merchant account company, serving both traditional and high-risk merchants.