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Have credit issues created problems for your business? If so, you’re not alone. Many small business owners with less-than-ideal credit struggle to get the financing they need. Whether you need capital to support your business growth or you’re working hard to overcome financial setbacks, the right business loan can completely change the game.
The good news is, there are plenty of options for financing your business needs, even if your credit isn’t quite where you would like. Here’s a look at some of the most popular bad credit business loans.
1. Short-Term loans
A short-term loan is an excellent option for many business owners. These loans have fixed payments and a pre-determined repayment period. This makes it easy to create a simple repayment plan that works with your budget.
When you take out a short-term loan, you’ll receive a lump sum of money that you can use to finance your business projects right away. Since you can use these loans for virtually any business purpose, you’ll enjoy plenty of flexibility without a long-term commitment.
Zinch is one of the top providers of short-term loans for business owners with low credit scores. We offer repayment terms ranging from three to 12 months, so you can take care of your immediate cash flow needs without a long-term commitment. Apply for a term loan with Zinch today and you’ll get cash in your account in just two to three days.
2. Cash Advance
A Merchant Cash Advance (MCA) is one of the most popular bad credit business loans because it’s not actually a loan! Instead, it’s simply an advance on your future sales.
When determining whether to approve your request for a merchant cash advance, your lender will typically consider your daily credit card sales, rather than your creditworthiness. If you have solid sales, you likely won’t have any problem getting approved for this financing option.
Unlike a short-term loan, an MCA doesn’t require any fixed payments. Your repayment amount is based on a percentage of your credit and/or debit card sales. If for some reason your sales go down, your required payment amount will decrease as well.
Zinch offers flexible MCA terms and fast approvals. We’ll also collect your payment via Automated Clearing House (ACH) or through your credit card processor, so you’ll never have to worry about missing a payment. Learn more about our MCA program today.
3. Accounts Receivable Financing
If you have a significant number of outstanding invoices, you might be a good candidate for Accounts Receivable Financing. These bad credit business loans allow you to convert your outstanding invoices into cash you can use to cover business expenses.
When you apply for this financing option, you’ll choose how many invoices you want to finance. The lender will typically provide you with a lump sum equal to 90% of the outstanding amount. When the customers pay their invoices, they’ll pay the lender directly, instead of paying you. Once all the invoices are paid off, you’ll receive the remaining 10%, minus any fees that accrued while you carried a balance.
Since your accounts receivable act as collateral, it’s easier to get approved for this type of financing when you have a questionable credit history. This makes it a popular choice among business owners with credit problems.
4. Equipment Financing
When you need to replace or purchase a new piece of equipment, you can often use the equipment itself as collateral for your bad credit business loan. Some lenders will offer to finance up to 100% of the equipment’s value, while others will require you to put down 10% to 20% of the purchase price.
It’s easy to access these loans even if you have poor credit since the lenders can simply seize and sell the equipment if you fail to make your payments.
5. Business Line of Credit
A business line of credit is a popular option for either large projects or daily working capital needs. While some require collateral, it’s also possible to obtain an unsecured line of credit. Business owners appreciate the flexibility this type of bad credit business loan offers.
One of the biggest advantages is that you can withdraw exactly the amount you need. This allows you to lower your interest expenses since you’ll only owe interest on the money you’ve actually pulled out.
Depending on the lender, you may need to make either weekly or monthly payments until your line of credit has matured. Once you’ve fully repaid the initial amount you’ve borrowed, you’re free to take additional withdrawals without having to start the loan process over again.
Apply for Bad Credit Business Loans Today!
Struggling with insufficient cash flow can make it nearly impossible to grow your business. Don’t let your credit issues hold you back! Zinch offers a variety of financing solutions for business owners just like you.
Contact us at (714) 500-6622 to learn more about your options. You could qualify for up to $250,000 in just 24 hours.
