small business lending

Small business loans bad credit


If you own a small business, and you’ve ever tried to apply for a loan from your nearest banking branch, you know about the difficulty that is inherent in that process. Aside from the mountain of paperwork that you will have to complete in order to even be considered for a bank loan; you’ll also need to present substantial assets that can be used as collateral for even the smallest loan. Often times, you’ll even discover that with collateral the banks valuation model can turn what you thought was substantial collateral into simply not enough.


The next hurdle that she’ll have to overcome will be in the form of a little thing we like to call a credit report. For traditional banks, small business loans and bad credit simply do not belong in the same sentence. After having you fill out mounds of paperwork and submitting to everything from an asset evaluation to a background check; the banks will still require that you possess a certain credit rating for them to seriously consider lending you a single dollar.


So of course, the question now is where does a small business owner turn when he or she has exhausted all of their available options? Since banks consider small business loans and bad credit to be at opposite ends of the spectrum, they’re not going to be the right source for small business, even if it does have substantial enough assets to meet the requirements of say a 3 to 1 asset to loan ratio. Which might even be a bit generous on the lending side – these ratios can easily reach 10 to 1 for businesses without enough operating history.


The answer to that question has largely eluded the small business owner for years, but now there is actually a source for small business loans with bad credit. These loans are being made available by a new breed of commercial lenders that focus on the business and its owner and an entirely different way than traditional funding sources have done over the years. These companies work with entrepreneurs to grow their business and meet their financial needs in a way that is simple, to the point and effective.


For simplification and the education of the entrepreneur who has been left out in the cold financially, we’ve referenced some of the sources of these creative funding companies. By focusing on the capabilities of the company that is looking to borrow funds, these companies are able to make small business loans in bad credit situations; looking beyond looking beyond the present condition of the lender and envisioning where a financial boost will take the company and its management.