Borrowing money is an overwhelming event in the best of times, and let’s be honest, often it does not come at the best of times. What happens in the tough times when you need money? Often traditional lending sources are not an option due to the time it takes to apply and be approved, poor credit, or an unsteady cash stream that makes traditional repayment terms difficult. There are other possibilities however.
Accounts Receivable Factoring or a Merchant Cash Advance
These two things are very similar, though not the same. Factoring is when you sell your uncollected receivables to a third party at a discount, collecting the difference from that company while they in turn try to collect and recover them at full cost. You lose a percentage of your revenue this way, but you can have the cash very quickly and repayment is not an issue.
A merchant cash advance is when a company offers an advance on predicted credit card sales, and repayment is made as a percentage of sales that are actually made. Again, this is quick cash and repayment terms that are much more management for some. This type of alternative lending relies very little on the credit of the borrower. The speed, ease of access, and ease of terms doesn’t come without cost though. Interest rates are typically much higher on this type of financing than that of traditional financing.
Business Credit Cards
If you have the option, having a business credit card or two around for emergencies isn’t a bad idea. They can even be used to grow your business with inventory discounts and small expansion projects without having to go through the hassle of a traditional expansion or equipment loan. Just be certain to shop around for the best rates and rewards so you can make your card work for you.
SBA Community Express Loan
This is a small business loan, backed by the Small Business Administration, that is a little faster and easier to access than traditional SBA loans. They are usually offered by community banks or credit unions, so try those lenders rather than big banks if you are interested in this type of loan.
Sometimes you know exactly what kind of financing you need, but finding lenders that deal in alternative lending is too overwhelming on its own. Biz2Credit can help with that. Our network can match you with lenders that offer exactly what you need. Visit Biz2Credit.com today to get started.