Bad Credit Business Loan Options for New Business Owners

    by Aditi Bansal

Updated on Sunday, June 11, 2017

There are several loan products businesses with bad credit can access for cash flow and keep running.

tags  #Bad Credit Business Loan  #New Nusiness Owner #


Many businesses worry about accessing bad credit business loans. There are different factors that contribute to bad credit; however, you will still need a loan at some point to help you with cash flow and other financial obligations. In such situations, bad credit business loans come to your rescue. Some of the options available include:

Private Loans

If your business is experiencing bad credit, you will have a hard time accessing money from traditional lenders, which leaves private lending or hard money lending as one of the few viable options. Often private loans come from individuals with extra money looking for investment opportunities who will often give you the money if you present a concrete business idea.  

The only downside is the high interest rates you incur with private loans. However, if you are operating on the edge, the loans can prove to be beneficial. Private lenders will often assess the quality of the investment, while trying to gauge whether they will get their money back if you default. They also offer a more relaxed application process.

Peer-to-Peer Lenders

Peer-to-peer lenders offer another alternative loan product to businesses. Ideally, you will visit a peer-to-peer website and connect with a business giving loans. You then submit your request, which lenders can see and contact you for further discussion. Once you come to an agreement, the peer-to-peer platform will help you set up a payment plan, where you both agree on an interest rate. The peer-to-peer platform takes the responsibility of deducting money from the borrower and sending it to the lender, based on a reasonable fee.

Merchant Lenders

Merchant loans can help you access the money you need with a reasonable and flexible payment plan that allows you to make a small payment every time you transact with your credit card. The merchant loan company will often set you up with a card terminal that ensures they receive a percentage of each sale you make. The advantage is you do not have to worry about setting up a payment plan immediately as you can slowly pay the money as you make money. As a new business trying to find a lender, merchant loans will always help you get started by lending you the money you need. 

This page has a focus on Bad Credit Business Loan, New Nusiness Owner was shared by Aditi Bansal.

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