How to Finance Inventory for Your Furniture Store Without Burning Cash Flow

Not all financing options are furniture store-friendly. If you’re looking for furniture financing but don’t have a strong credit score — or no credit — you may need to find easy furniture financing that gives credit approval to borrowers without much hassle. Here’s how to get the easiest furniture financing for your business.

How to find easy furniture financing

Furniture financing is one way to build inventory for your furniture store business without using personal funds to cover the costs. There are many types of furniture inventory financing and you don’t need to tap into your own resources to fund your business.

1. Clear financing options

Make sure lenders state all of their easy furniture financing options for every type of borrower. There are some choices for borrowers with no credit, a low credit score, and borrowers with excellent credit.

All payment options should detail what to expect in the application process, typical repayment terms, expected monthly payments, and how to get credit approval if you have less-than-stellar credit.

Some easy furniture financing options don’t always detail all the financing charges openly, which makes it difficult for potential borrowers to understand. You may find some choices have hidden fees or require minimum monthly payments to earn a promotional offer for a specific time. If you don’t read the terms of your agreement, you may have to pay a promo fee or lose out on a promotional APR if you don’t meet specific criteria.

Not all lenders offer flexible financing options, and if you don’t get credit approval, you may not be able to pay for the furniture inventory you need for your business.

2. See if you prequalify

The easiest furniture financing lets you see if you’re eligible for financing options without completing a full application first.

To prequalify with a lender, you’ll self-input your credit details without a hard credit pull. Getting prequalified is different from preapproval, which is when a lender pulls your credit score and credit history.

Getting prequalified doesn’t impact your credit score and the lender doesn’t check your credit. You can get prequalified with many different lenders. However, you’ll need to make sure you know your credit score and history before getting prequalified. If you enter a different credit score during prequalification, you might prequalify for a different amount or for a different interest rate than you would during the final approval process. Knowing the right details could be the difference-maker between qualifying for easy furniture financing and not getting approved at all.

While not all easy furniture financing offers business prequalification, it’s also a good idea to know your business credit score.

3. Simple application

Easy furniture financing should allow you to complete a quick application online with fast results letting you know if you’re approved right away. If you aren’t approved, find out what you need to finalize an application. If the application is too confusing, it may be best to find another lender.

Some lenders make applications more complicated to complete, which makes taking out a credit line or special financing more difficult. A more complex application could mean a more difficult payment process down the road, whether for cardholders or borrowers trying to make minimum monthly payments. Use the application as a preview for future monthly payments.

Where to look for easy furniture financing

There are many different ways to jump-start your furniture store business. If you don’t have the cash to pay for quality furniture to sell in your store, financing your furniture inventory can help get you started.

Personal loans

Starting from scratch means you may have to take out a personal loan to launch your furniture store business. Personal loans can be used for anything, including starting a business. If you need a lump-sum loan to finance your furniture inventory, you can get easy furniture financing with a personal loan.

While personal loans are for anything, this is a personal loan, not a business one. If you fail to repay your loan, your credit score will fall, making it difficult to borrow money in the future.

Personal line of credit

If you aren’t sure how much you need in up-front costs, you can shoot for easy furniture financing through a personal line of credit, like a credit card. A revolving credit line lets you finance furniture inventory as needed so you aren’t borrowing more than necessary.

If you’re planning to finance furniture inventory one time and then be done with it, a lump-sum loan would be a good fit. But if you’d prefer to use financing on an ongoing basis, a personal line of credit helps cover those costs without needing to regularly borrow a new loan every time you need extra cash.

Business line of credit

While many small business owners use personal loans to start small businesses, you can find flexible financing options by taking out a business credit line. You may get easy furniture financing if you’ve already launched your company and have a business bank account.

You can explore a credit line at your current bank, credit union, or online financial institution. Easy approval furniture financing may be a better fit if you have an established relationship as a current customer.

Business loans

The easiest furniture financing goes to businesses that have strong financial standing and can prove they can reliably repay a loan. If your company has ways to demonstrate stability, furniture financing will be easier for you.

Private financial institutions — like banks, credit unions, and online lenders — offer various business loans. Each has its own minimum borrowing amount and eligibility requirements.

SBA loans

SBA loans are loans backed by the Small Business Administration. These types of loans offer some of the easiest furniture financing and reduce the risk for the lender. Various SBA loans are available, depending on your business type, the funding you need, how much money you’re requesting, and what the funds will be used for.

Not all loans allow you to cover furniture inventory costs, but most SBA loans do. Make sure you know which type of loan you need before completing an application.

How lenders evaluate businesses for financing

Lenders will be looking at what you offer your customers. For instance, a physical furniture store or multiple store locations tells lenders your company can afford brick-and-mortar locations. Selling quality furniture in-store proves you’re a reliable business that’s worth lending to. Some companies looking to finance inventory don’t have in-store businesses or a showroom, which makes it difficult to prove how profitable a company is.

Think about the different financing options you offer your customers. For example, do you have a lease-to-own option for potential customers looking to buy furniture from your store? Can potential customers easily open new accounts for a loan or line of credit? Do you have a “no down payment” option or a minimum purchase on qualifying purchases? What sort of options do you offer those with bad credit or no credit at all?

Offering your own financing options to potential customers shows lenders you value all types of customers and are willing to meet the consumer where they are when shopping at your store. But make sure you put additional protections in place so that you don’t allow yourself to lose too much money while offering additional services to your customers. That regular cash flow eats into your ongoing inventory purchases, payroll, equipment, and bill payments.

Find furniture store financing

As you get started with furniture inventory financing, think about how your inventory matters to your customers, whether it’s sectionals, sofas, dining rooms, living rooms, or other pieces. Envision how you lay out your showroom and the service you provide to your customers as you look for easy furniture financing.

FAQs about easy furniture financing

What credit score do I need to finance furniture?

There is no universal credit score requirement that every bank follows. Because of this, it’s important to compare different lenders based on their own requirements. Each one has different eligibility requirements and you might qualify for one and not another.

Which SBA loan is easiest to get approved for?

If you’re trying to get an SBA loan, look into SBA microloans, since they are best for borrowers with bad credit (or no credit). SBA microloans are easy furniture financing options, with a simple application and a quick turnaround time.

How to get a business loan with no revenue?

If you’re launching your furniture store without revenue, getting easy furniture financing might be difficult compared to those with established businesses. You might be able to find some funding options, like SBA microloans or business credit cards. There's a chance you may have to use personal loans or your personal credit score to back up a business loan.

How much can I realistically get for a small business loan?

Small business loans vary based on your business type since “small” is relative to your business and industry. Furniture inventory costs might be expensive, which means you should borrow enough to cover what you need to buy.

Can a start-up LLC get a loan?

Start-up LLCs can get business loans. All types of businesses qualify for business loans, but how you want to use the funds may impact the type of loan you get.

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