A bad credit score can get in the way of a lot, especially financial processes like loan acquisition. However, if you’re an entrepreneur who needs an equipment loan for your small business, never fear; a lower credit score doesn’t mean you’re incapable of financing your essential equipment needs. While you’re working on improving your credit score through timely payments, read on for some tips on how to finance business equipment with poor credit.
1. Merchant Cash Advance
This is a viable option for a fast influx of cash. You’ll likely be approved relatively quickly — sometimes in a matter of hours — even if your credit score is substandard. You can make payments according to your cash flow. Thus, if you have a great month in sales, you can pay back more money that month. Conversely, if you have a bad month, you can pay back less. It’s a great system for those businesses that don’t have a steady cash flow yet. Interest rates are generally higher from cash advance companies than they are from banks.
If you need less than $50,000, a microloan might be the right product for you. Microloans tend to be processed more quickly than traditional bank loans, and lending institutions will generally be more forgiving towards those whose credit scores are lower.
If you have some kind of collateral backing up your loan, lending institutions will be more likely to give you money. This is because if you fail to repay the loan on time, you have something to fall back on. So keep that in mind when you’re filling out your next loan application.
Biz2Credit can help you figure out the best path to take. Loan specialists can help you navigate through the array of options to pick the one most suitable to your business. Visit www.biz2credit.com or call (800) 200-5678 for help.