Tag: Alternative

Use This Secret Weapon to Slay Your Funding Foes and Find the Best Sources of Alternative Loans for Businesses

Are you struggling to get funding for your business? Never fear, alternative loans for businesses are here. They tend to get a bad rap. This is mostly due to the fact that predatory lending runs rampant in today’s world, and it’s hard to know who to trust and who is scamming you. However, not all sources of alternative business financing are created equal. 

10 Alternative Loans for Businesses to Help Your Business Soar

Nothing is guaranteed and things change every day. Still, at the moment, these 10 alternative lenders for small business tend to work well for many. They also offer a wide range of alternative business financing options to fit a variety of needs. 

 

Learn business loan secrets and get money for your business.

Fundation

When it comes to alternative loans for businesses, Fundation provides both term business loans and lines of credit. It is most known for its working capital financing options. These are funds meant to help cover the day-to-day costs of running a business rather than larger projects. 

StreetShares

StreetShares has its roots in lending to veterans.  They still hold true to that mission, but now offer term loans, lines of credit, and contract financing to all types of business owners. The maximum loan amount is $250,000, and preapproval only takes a few minutes. They use a soft pull on your credit so it doesn’t affect your score. 

BlueVine

There are two options for small business financing with BlueVine. They include lines of credit and invoice factoring. Minimum loan amount is $5,000 and maximum loan amount is $100,000. Annual revenue must be $120,000 or more and the borrower must be in business at least 6 months. Personal credit score has to be 600 or above.

Fundbox

With Fundbox, you get an online lender that offers a super-fast automated process. Originally, they only had invoice financing. Yet, now they offer a line of credit service as well. Repayments are automatic on a weekly basis.  So,be sure you have enough funds in whatever account you let them draft from to cover your payment each week. 

Kiva 

Kiva is an online lender that is a little different. For example, the interest rate is 0%.  That means even though you have to pay it back, it is absolutely free money. They don’t even check your credit. There is one catch though. You have to get at least 5 family members or friends to throw some money in the pot as well. In addition, you have to pitch in a $25 loan to another business on the platform. 

 

Learn business loan secrets and get money for your business.

Fora Financial

Fora Financial was founded in 2008 by college roommates. It now funds more than $1.3 million in working capital around the United States. There is no minimum credit score, and there is an early repayment discount if you qualify. 

OnDeck

Obtaining financing from OnDeck is quick and easy. First, you apply online.  If you receive approval, your loan funds will go directly to your bank account. 

Lendio

The secret to Lendio’s success is excellent customer service and a short, easy application process. The loan-connections service it offers slashes the time it takes to find the right alternative loans for businesses. This is due to its heavily vetted network of lenders. 

Credibly

Credibly is a specialized lender offering unsecured business loans online. The application process and funding can be complete in as little as two days, sometimes less. They offer daily and weekly repayment options. 

Upstart

Upstart uses a completely innovative platform for loans.  They choose to use a combination of artificial intelligence (AI) and machine learning to gather alternative data for use in making credit decisions.

This may include such things as mobile phone bills, rent, deposits, withdrawals, and even other information less directly tied to finances.  The software they use learns and improves on its own. You can use their online quote tool to play with different amounts and terms to see the various interest rate possibilities.  

 

Learn business loan secrets and get money for your business.

Warning: Alternative Loans for Businesses Aren’t for Everyone 

Despite the fact that these alternative lending companies tend to offer alternative loans for businesses with less stringent requirements, they won’t work for everyone. Alternative financing methods are just not always a good fit.  Here is another other option.  Keep reading to the end for a sure-fire way to ensure you can always qualify for the business funding you need when you need it. 

The Credit Line Hybrid

What if there were alternative financing options that allowed you to have an even better interest rate than a secured loan, and yet get the money faster and easier than any type of traditional funding.  What if you could get business funding without having to supply bank statements or check stubs? This is exactly what the Credit Line Hybrid offers. 

This is alternative funding for small business that allows you to  fund your business without putting up collateral.  You only pay back what you use. You do need good personal credit however.  That is, your personal credit score should be at least 680.  In addition, you can’t have any liens, judgments, bankruptcies or late payments.  Furthermore, in the past 6 months, you should have less than 6 credit inquiries.  Also, you should have less than a 45% balance on all business and personal credit cards. In addition, you need at least 2 credit cards with at least 2 years credit history. 

If you don’t meet all those requirements, you can still qualify.  You can take on a credit partner that meets each of these requirements.  Many business owners work with a friend or relative to fund their business.  If a relative or a friend meets all of these requirements, they can partner with you to allow you to tap into their credit to access funding. 

Use This Secret Weapon and Always Get the Business Funding You Need

To be eligible for the highest limits and best rates when it comes to business credit, your business has to be fundable. There are over 100 factors that impact the fundability of a business. It is a complicated web to weave through. Things from decades ago, long before you ever imagined owning a business, can affect fundability. 

The key to having a strong, fundable business that can qualify for any funding is to work with a business credit expert. What can a business credit expert do for you?

  • Help you assess the current fundability of your business
  • Guide you to the most effective and efficient ways to improve fundability if necessary
  • Help you find the best funding options for your business right now
  • Guide you in what specific, actionable steps you need to take to qualify for more funding with better rates
  • Leverage lender relationships to cut through a lot of the red tape and bureaucracy that can keep borrowers from getting the information they need, when they need it

It’s common for a borrower to call a lender or vendor credit department directly and not be able to find out if they report to the business credit reporting agencies, or exactly what they are looking for when it comes to credit approval.  

A business credit expert already knows a lot of this information, and what they don’t know, they  know how to get. They also know their way around alternative sources of financing for business, so they can offer guidance in this area as well. 

This is your number one top-secret weapon to getting your business to a point where you know you can get funding when you need it. Try a free consultation with a Credit Suite business credit expert to get started now.

The post Use This Secret Weapon to Slay Your Funding Foes and Find the Best Sources of Alternative Loans for Businesses appeared first on Credit Suite.

Use This Secret Weapon to Slay Your Funding Foes and Find the Best Sources of Alternative Loans for Businesses

Are you struggling to get funding for your business? Never fear, alternative loans for businesses are here. They tend to get a bad rap. This is mostly due to the fact that predatory lending runs rampant in today’s world, and it’s hard to know who to trust and who is scamming you. However, not all … Continue reading Use This Secret Weapon to Slay Your Funding Foes and Find the Best Sources of Alternative Loans for Businesses

Alternative Lenders: Pros and Cons

There is a time and place for traditional business lenders, otherwise known as banks.  However, they are not always the right option.  Sometimes is takes too long to get funding from a bank. Maybe you do not qualify for a loan from a bank. This can be the case even if you are perfectly capable of repaying your debt.  If business borrowing from a bank isn’t going to work for you, your next option is alternative lenders.  

What Are The Pros and Cons of Using Alternative Lenders?

Alternative lenders are a totally legitimate option.  They are exactly what their name implies, an alternative to traditional banks. However, just like banks, they have both pros and cons. You need to know and understand each when looking for financing alternatives for small businesses. 

What Are the Pros of Alternative Lenders? 

First, with alternative lenders, you typically get your funds much faster. So, if you need fast cash, this could be the way to go. 

Also, the application process is usually faster and easier. Often you can apply online in a matter of minutes. Repayment terms are usually more flexible as well. 

Find out why so many companies use our proven methods to get business loans.

Even better, these lenders will often take more into account that just credit score when it comes to approval. If there is a minimum credit score requirement, it is usually much lower than what traditional lenders require. 

As a result, they have other eligibility requirements.  These may include minimum revenue over a certain period of time, a minimum amount of time in business, minimum average balance in a business bank account, or all three.  Other requirements may apply as well. 

What Are the Cons of Alternative Lenders?

One of the biggest drawbacks of alternative lenders is that their interest rates are almost always higher, though rates vary based on perceived risk.  

Also, the industry is a breeding ground for scammers.  It’s important to know how to recognize predatory lending practices to avoid being taken advantage of if you are looking for an alternative lender.

Best Options for Alternative Lending: Top Alternative Lending Companies

Despite the risk of running into a predatory lender when it comes to alternative loans for businesses, there are some good companies out there. To give you a start, here are some alternative business financing options that we know and trust. 

Fundbox 

Fundbox makes it easier to get approval for financing.  The minimum credit score is 500.  Comparatively, this is much lower than with other lenders.  Here are some things you need to know about Fundbox.  First, they consider business merit as opposed to personal credit.  For application purposes, they will do a soft pull on your personal credit. This will not affect your credit score.  When you make your first draw, they will do a one time hard pull that could affect your score.  Keep that in mind. 

Kiva 

Kiva is an online lender that is a little different. For example, the interest rate is 0%.  That means even though you have to pay it back, it is absolutely free money. They don’t even check your credit. Still, there is one catch.  You have to get at least 5 family members or friends to give to the cause as well. In addition, you have to pitch in a $25 loan to another business on the platform. 

Accion 

Accion is a nonprofit lending network dedicated to helping small businesses.  They offer small business loans, some grant opportunities, and other resources designed to help both startups and established small businesses grow and thrive. 

Globally they have been working their magic for 55 years across 4 continents.  Tens of millions of entrepreneurs have been helped by them.  They came to the United States in 1991. 

They lend to small business owners in general, from all backgrounds and most industries. However, they specialize in underserved populations like minorities. 

They do not rely as heavily on credit as traditional lenders. Yet, they do require a minimum personal credit score of 575. The one exception is the Community Advantage program which requires a minimum of 525.  

Other restrictions may apply based on a number of factors. 

Streetshares 

 Streetshares  offers a variety of financing and investment products with fast application processes and funds deposited almost immediately. Lending products never have a prepay penalty, and the credit check is a soft one.  There is never any impact on your credit score for applying.

They lend to various types of businesses and business owners.  Still, their early mission was to help veteran business owners, and they remain true to that mission today.

Find out why so many companies use our proven methods to get business loans.

Credit Line Hybrid

This is alternative business financing rather than a specific alternative lender.  The Credit Line Hybrid is a unique and powerful product that can serve your business needs in many ways. It allows you to fund your business without putting up collateral, and you only pay back what you use.  

Your personal credit score needs to be at least 680.  In addition, you can’t have any liens, judgments, bankruptcies or late payments.  Furthermore, in the past 6 months you should have less than 4 credit inquiries, and you should have less than a 45% balance on all business and personal credit cards.  It’s also preferred that you have established business credit as well as personal credit. 

If you do not meet all of the requirements, it’s okay. You can take on a credit partner that meets each of these requirements.  Many business owners work with a friend or relative to fund their business.  If a relative or a friend meets all of these requirements, they can partner with you to allow you to tap into their credit to access funding. 

What are the Benefits of a Credit Line Hybrid? 

As alternative funding sources go, this is one of the most flexible.  There are many benefits to using a credit line hybrid.  First, it is unsecured, meaning you do not have to have any collateral to put up.  Next, the funding is “no-doc.”  This means you do not have to provide any bank statements or financials.  

Not only that, but typically approval is up to 5x that of the highest credit limit on the personal credit report. Additionally, often you can get interest rates as low as 0% for the first few months.  This allows you to put more money back into your business. 

The process is fast, especially with a qualified expert to walk you through it.  Also, approval for multiple credit cards creates competition.  This makes it easier, and even likely if you handle the credit responsibly, that you can get interest rates lowered and limits raised every few months.

Find out why so many companies use our proven methods to get business loans.

Alternative Lenders Are a Viable Option, But Be Careful

You can’t be too careful when looking for alternative financing methods for your business.  The safest way to ensure you don’t fall prey to a scammer is to work with a business credit expert.  They will not only have relationships with credible lenders, but they will also be able to help you find those with products and requirements that best fit your needs. CreditSuite has business credit experts ready to help.  They  have the skills and expertise necessary to help you navigate the business funding world. They can guide you toward products and lenders that will work best for your needs, and help you improve your fundability in the process. With strong fundability, you can access all types of business financing, alternative or not.

The post Alternative Lenders: Pros and Cons appeared first on Credit Suite.

6 Things You Need to Know About Alternative Business Lending

Alternative business lending rose from the ashes of the 2008 crash. This was a time when lenders were giving almost no one money.  It was virtually impossible to get a loan of any sort for any reason. Business loans were extremely hard to come by, and when you could get one, rates were terrible. 

Alternative Business Lending: Your Questions Answered

Find out why so many companies use our proven methods to get business loans. 

As a result, alternative lenders began to pop up. Funding Circle is credited with being the first, but others soon followed. That means this is a fairly new game.  It can be hard to figure out if it is one you should play. This should help. 

  1. What is alternative business lending? 

alternative biz lending Credit SuiteThis type of lending is offered through private companies, not traditional financial institutions like banks and credit unions. They can be an option for those who do not qualify or who do not have the time to wait for a bank loan. These lenders explore other ways of verifying creditworthiness and other forms of collateral. 

Collateral may include credit card transactions, open invoices, equipment, real estate and more. 

  1. How much is alternative business lending?

This is a question asked by many when they first start considering alternative lending options.  The truth is, it depends. That’s the case with any loan.  There are fees, and interest is a factor.  Typically interest is higher with alternative lending. But if you can’t get anything else, you can’t really compare.  

  1. What are the pros of alternative business lending? 

So, why choose alternative lending? Well, if you can’t get a traditional business loan you may need to consider this option. However, there are other reasons as well. For example, alternative lenders typically fund much faster. So, if you need fast cash, this could be the way to go. 

Also, the application process is usually faster and easier. Often you can apply online in a matter of minutes. Repayment terms are usually more flexible as well. 

  1. What are the cons of alternative lending?

As already mentioned, interest rates with alternative loans are usually higher. There is also a breeding ground for scammers in this industry.  It’s important to know how to recognize predatory lending practices to avoid being taken advantage of.

  1. Is alternative business lending right for you? 

If something is blocking you from being approved for a loan through a bank or credit union, then the answer to this question is probably yes. It is highly likely that this is a type of lending that can work well for your business. This is especially true if you have invoices, accept credit card payments, or need to finance equipment. Common types of alternative loans include: 

  • Merchant cash advances
  • Invoice financing
  • Equipment financing
  • And  real estate financing

There are other options as well, and they vary between lenders. These are some of the most 

common however. 

  1. A credit expert can help you find the best alternative business funding for your business. 

Now you need to figure out which lender and which products from that lender will work best for your specific business needs and goals.  The best choice is to work with a business credit expert.  This is someone that can help your maneuver through the process in the most effective and efficient way.  That will help immediately.  Beyond that, into the long-term, an expert in business credit can help you figure out why you are being denied funding, and help you fix the problem. 

Where should  you start when looking for alternative lenders? Here are some options to consider. 

Find out why so many companies use our proven methods to get business loans. 

Fundbox

Fundbox offers a line of credit rather than a loan.  Still, it is a great funding option because there is no minimum credit score requirement. 

 They offer an automated process that is super-fast. Repayments are automatic, meaning they draft them electronically, and they occur on a weekly basis.  One thing to remember is that you could have a repayment as high as 5 to 7% of the amount you have drawn currently, as the repayment period is comparatively short.  This means you need to be sure you have enough funds in whatever account you connect them to so that it can cover your payment to Fundbox  each week. 

 BlueVine 

You will find with most any online lender, they often offer options more similar to invoice factoring and lines of credit.  This is because those options present fewer risks than straight term loans.  BlueVine is no different. 

Upstart

Upstart is an online lender that uses a completely innovative platform for loans.  The company itself questions the ability of financial information and FICO on their own to truly determine the risk of lending to a specific borrower.  Instead, they choose to use a combination of artificial intelligence (AI) and machine learning to gather alternative data for use in making credit decisions.

This may include such things as mobile phone bills, rent, deposits, withdrawals, and even other information less directly tied to finances.  The software they use learns and improves on its own. You can use their online quote tool to play with different amounts and terms to see the various interest rate possibilities.  

Upstart’s innovative platform makes them one to research for sure. 

Fora Financial 

Founded in 2008 by college roommates, online lender Fora Financial now funds more than $1.3 million in working capital around the United States. There is no minimum credit score, and there is an early repayment discount if you qualify. 

 OnDeck 

Obtaining financing from OnDeck is quick and easy. First, you apply the OnDeck website and receive your decision once application processing is complete. If you receive approval, your loan funds will go directly to your bank account. The loan amounts range up to $500,000.

 Lending Club

Popular online lender Lending Club offers term loans.  You can get a quote in less than 5 minutes. Funds are available in as little as 48 hours if approved. There are no prepayment penalties.

Kiva 

Kiva is an online lender that is a little different. For example, the interest rate is 0%.  That means even though you have to pay it back, it is absolutely free money. They don’t even check your credit. However, there is one catch.  You have to get at least 5 family members or friends to throw some money in the pot as well. In addition, you have to pitch in a $25 loan to another business on the platform. 

Find out why so many companies use our proven methods to get business loans. 

Accion 

If your personal credit is okay, Accion may be a good fit for small business startup loans. It is a microlender, a nonprofit, that offers installment loans to both startups and already existing businesses. 

 Credibly 

Credibly is also a good option for business loans if you are already generating some revenue. They offer short term loans for both business expansion and working capital. You must be in business for at least 6 months to qualify, and Credibly will approve loans to those with credit scores as low as 500. 

Alternative Business Lending Is a Great Tool, but Not a Forever Answer

I mean, it could be a forever answer, but there is a better way.  If you work to build up your fundability, you can get a lot of perks offered by alternative business lending with the interest rates offered by traditional loans.  You could have the best of both worlds.  It takes time to get there however, and alternative loans are the best option for many in the meantime. 

The post 6 Things You Need to Know About Alternative Business Lending appeared first on Credit Suite.

NYSE's Plan for New IPO Alternative Wins Green Light From SEC

Regulators have approved a proposal from the New York Stock Exchange to let companies raise capital through direct listings, a decision that creates a cheaper alternative to the traditional initial public offering.

The post NYSE’s Plan for New IPO Alternative Wins Green Light From SEC first appeared on Online Web Store Site.

The post NYSE’s Plan for New IPO Alternative Wins Green Light From SEC appeared first on ROI Credit Builders.

NYSE’s Plan for New IPO Alternative Wins Green Light From SEC

Regulators have approved a proposal from the New York Stock Exchange to let companies raise capital through direct listings, a decision that creates a cheaper alternative to the traditional initial public offering.

The post NYSE’s Plan for New IPO Alternative Wins Green Light From SEC first appeared on Online Web Store Site.

The post NYSE’s Plan for New IPO Alternative Wins Green Light From SEC appeared first on ROI Credit Builders.

Is It Time to Look at Alternative Business Loans?

Everyone is struggling right now.  COVID-19 knocked the global economy for a loop.  Have you taken advantage of all the unique funding options available for relief related to the coronavirus pandemic?  Did you apply for the Paycheck Protection Plan?  If you did, and you find yourself still struggling, it may be time to check into alternative business loans. 

How to Get Alternative Business Loans and Can They Work for You?

If you have exhausted all of the state and federal funding available, or you are having trouble getting access, it may be time to consider alternative business loans to help bridge or fill the funding gaps left by the shattered economy.

Score the best business credit cards for your business, even when a recession looms.Check out our professional research.

What Are Alternative Business Loans?

These are loans that come through private lenders rather than banks.  The majority of them operate online.  For the most part, the process is fast and easy. You fill out an application online, and typically you receive approval in as little as a few hours.  Once approved, funds are often in your account in a day or two.  

The quick, simple process makes alternative business loans an attractive option. This is especially true if you have trouble qualifying for loans from traditional lenders due to credit score issues or lack of collateral. 

Why Is It Easier to Qualify for Alternative Business Loans? 

If these alternative loans are so fast and easy, why even bother with traditional loans?  Well, interest rates and terms are considerably less favorable than those you may get with a traditional lender. 

That’s because, to extend credit to those that do not qualify with a bank, alternative lenders have to relax a little on their eligibility requirements. As a result, they take on a lot more risk with their loans.  To make up for it, they increase interest rates and loan terms.  It helps to balance things out.  

Alternative Business Loans: How Do I Start? Where Do I Start? 

alternative biz loans Credit SuiteOnce you know you are in a position to need alternative business loans, you can start shopping around. How?  Research is key.  Thorough research is important to make sure you find the best fit for your business. 

While many alternative business loans have similar requirements, there are some vastly different and innovative platforms out there as well.  Read all the reviews, but don’t forget to look at the actual lender websites too.  Only you know what your situation is. You are the one that knows your credit score, how long you have been in business, and how much debt you can handle. 

Start by figuring out eligibility.  You may not be able to anticipate what every single lender will want to see.  However, there are a few things that most lenders will want to know before approving a loan.  Things such as credit score, annual revenue, and length of time in business are pretty common.  

If you know your score and what your annual revenue is before you begin looking, you will be able to weed out the ones you do not qualify for from the start. There are so many that you will definitely see the need to do this.  Here are just a few as an example. 

Kick Off Your Alternative Business Loan Search with These Lenders

Fundbox

If you start with a search for an online lender, Fundbox is going to be one of the first to pop up.  It is a line of credit rather than a loan, but it is a great funding option because there is no minimum credit score requirement. 

They offer an automated process that is super-fast. Repayments are automatic, meaning they draft them electronically, and they occur on a weekly basis.  One thing to remember is that you could have a repayment as high as 5 to 7% of the amount you have drawn currently, as the repayment period is comparatively short.  This means you need to be sure you have enough funds in whatever account you connect them to so that it can cover your payment each week.

BlueVine 

You will find with most any online lender, they often offer options more similar to invoice factoring and lines of credit.  This is because those options present fewer risks than straight term loans.  BlueVine is no different.

Upstart

Upstart is an online lender that uses a completely innovative platform for loans.  The company itself questions the ability of financial information and FICO on their own to truly determine the risk of lending to a specific borrower.  They choose to use a combination of artificial intelligence (AI) and machine learning to gather alternative data instead.  They then use this data to help them make credit decisions.

This alternative data can include such things as mobile phone bills, rent, deposits, withdrawals, and even other information less directly tied to finances.  The software they use learns and improves on its own. You can use their online quote tool to play with different amounts and terms to see the various interest rate possibilities.  

Upstart’s innovative platform makes them one to research for sure. 

Fora Financial 

Founded in 2008 by college roommates, online lender Fora Financial now funds more than $1.3 million in working capital around the United States. There is no minimum credit score, and there is an early repayment discount if you qualify.

OnDeck 

Obtaining financing from OnDeck is quick and easy. First, you apply online and receive your decision once application processing is complete. If you receive approval, your loan funds will go directly to your bank account. The minimum loan amount is $5,000 and the maximum is $500,000..

Lending Club

Popular online lender Lending Club offers term loans.  You can get a quote in less than 5 minutes. Funds are available in as little as 48 hours if approved. There are no prepayment penalties.

Score the best business credit cards for your business, even when a recession looms.Check out our professional research.

Kiva 

Kiva is an online lender that is a little different. For example, the interest rate is 0%, so even though you have to pay it back it is absolutely free money. They don’t even check your credit. However, there is one catch.  You have to get at least 5 family members or friends to throw some money in the pot as well. In addition, you have to pitch in a $25 loan to another business on the platform.

Accion

If your personal credit is okay, Accion may be a good fit for small business startup loans. It is a microlender, a nonprofit, that offers installment loans to both startups and already existing businesses.

Credibly 

Credibly is also a good option for business loans if you are already generating some revenue. They offer short term loans for both business expansion and working capital. You must be in business for at least 6 months to qualify, and they will approve loans to those with credit scores as low as 500.

Credit Line Hybrid: Another Great Alternative

A credit line hybrid is basically revolving, unsecured financing.  It allows you to fund your business without putting up collateral, and you only pay back what you use.  

It’s not as hard to qualify as you may think. You do need good personal credit.  That is, your personal credit score should be at least 685.  In addition, you can’t have any liens, judgments, bankruptcies or late payments.  Also, in the past 6 months, you should have less than 5 credit inquiries, and you should have less than a 45% balance on all business and personal credit cards.  It’s also preferred that you have established business credit as well as personal credit.

If you do not meet all of the requirements, all is not lost. You can take on a credit partner that meets each of these requirements.  Many business owners work with a friend or relative to fund their business.  If a relative or a friend meets all of these requirements, they can partner with you to allow you to tap into their credit to access funding. 

Other Options If You Still Need Funding

What if, even with alternative business loans or a credit line hybrid, you still need more funding?  Here are some other options to explore. 

Business Credit Cards 

These may get a bad reputation, but without another option, they can actually do the trick quite nicely. The benefit is that these are available more readily even with a credit score that isn’t awesome. However, the lower the credit score, the higher the interest rate. Also, even credit card companies have limits on how low of a credit score they will accept.

This is one funding option that most of the general public are eligible for at any given time. They do a credit check, but your credit doesn’t have to be as high as it would be to gain approval for a traditional loan. 

The downside, of course, is that they usually have high interest rates. The upside is that many of them offer rewards in the form of cash or points that can be helpful.

Grants 

While requirements vary from grant to grant, and most are only awarded to a certain number of recipients, this is one of the available funding types worth looking into if you fall into one of these basic categories.

  • Businesses run by veterans
  • Businesses in low income areas

There are also some corporations that offer grants in a contest format that do not require much other than that you meet the corporation’s definition of a small business and win the contest.

While there are not a lot of these out there, they are more common that you probably think. Typically, they are offered by professional organizations. There are some government grants available also. Competition can be stiff, but they are definitely worth a shot if you think you may qualify.

Score the best business credit cards for your business, even when a recession looms.Check out our professional research.

Crowdfuding

This is a newer option for finding investors. While the average person that wants to start a business needs funding, it is not always possible to find one or two large investors. 

With crowdfunding, you can literally have a crowd of investors fund your business $5 and $10 at the time. 

There are many crowdfunding sites.  The most popular are Kickstarter and Indiegogo. The platforms are similar but there are some differences that bear mentioning. The most obvious difference is with the timing of when you actually receive the funds that others invest in your company.

Kickstarter requires a goal set from the beginning.  You do not receive your funds until you reach that goal. For example, if you set a goal of $10,000 when you start your campaign, you will not receive any money that investors offer up until you reach that $10,000. 

Indiegogo requires a goal as well.  However, they offer the option to receive funds as you go. They also have an option called InDemand. This is a program that allows you to continue raising funds after your original campaign is over without starting a whole new campaign. It is more like you are just extending the first campaign.

There are other crowdfunding sites out there as well. Some work better for certain businesses and vendors. To determine which one might be best for you, you will have to do some research. 

Alternative Business Loans Are a Viable Option if Traditional Loans Will Not Work

At this point, it’s all hands on deck.  Most businesses need money, and they need it now.  Everyone is just trying to stay above water. Definitely take advantage of all of the options available from the Federal government, your state government, and any local organizations trying to help small businesses right now.  Even local governments are helping out in many areas. 

However, sometimes it will take much more.  Sometimes, you may even have to get innovative and adapt the way you operate to our current global circumstances.  Alternative business loans are great for that. If you need a little more help, check out business credit cards, crowdfunding, and even grant opportunities. 

All of these options are available to help you get the funds you need right now so your business can survive.

The post Is It Time to Look at Alternative Business Loans? appeared first on Credit Suite.

5 Up to the Minute Alternative Small Business Loans

And Why You Still Need Business Credit Even if You Already Qualify for Them

When a business owner is looking for funding, it can be a bit confusing.  There are way more options that most realize before the fact.  Many head straight to the bank and apply for a loan.  When they are denied, they are left with confusion and despair.  First, they do not know why they were denied, and next, they don’t know what to do if they can’t get a loan.  There are a few different options, but the next best thing for most business owners would be alternative small business loans.

What Are Alternative Small Business Loans?

These are loans that come through private lenders rather than banks.  The vast majority of these lenders operate online.  For the most part, the process is fast and simple. Borrowers fill out an application online, and generally receive approval in as little as a few hours.  Once approved, funds are often in the borrower’s account in as little as a day or two.

The fast, easy process makes these alternative small business loans an attractive option for business funding.  This is especially true for those who find they do not qualify for loans from traditional lenders.

Is There a Catch to Alternative Small Business Loans?

I know what you’re thinking.  If these alternative loans are so fast and easy, why even bother with traditional loans.  Do people just not know about them? There has to be some catch.  Well yeah, there kind of is.  The catch is, interest rates and terms are considerably less favorable than those you may get with a traditional lender.

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That’s because, in an effort to extend credit to those that do not qualify with a bank, alternative lenders have to be a little more relaxed with their eligibility requirements. As a result, they are taking on significantly more risk with their loans.  To make up for this, they increase interest rates and loan terms to balance things out.

How do I choose the Right Alternative Loan for Me?

Once you know you are in a position to need alternative small business loans, you can start looking for the right one for your situation. How do you do this?  The key is to research, research, research.  Extensive research is absolutely necessary to ensure you find the best fit for your business.

While many of them function the same with similar requirements, there are some vastly different and innovative platforms for these types of loans as well.  Read all the reviews, but don’t forget to look at the actual lender websites too.  Only you know what your specific situation is.  Only you know your credit score, how long you have been in business, and how much debt you can handle.

How to Start Finding the Right Alternative Small Business Loans

Start by determining your eligibility factors.  You may not be able to anticipate what every single lender will require.  However, there are a few things that most lenders will want to know before approving a loan.  Things such as credit score, annual revenue, and length of time in business are pretty common.

If you know your score and what your annual revenue is before you begin looking for alternative small business loans, you will be able to weed out the ones you do not qualify for from the beginning. There are so many that you will definitely see the need to do this.  Just to show you a sampling of what’s available, we have chosen a few different ones to get you started.

5 Alternative Small Business Loans to Kickstart Your Research

Start here, but definitely do not stop with this list.  There are far too many options available, and new ones pop up regularly.

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Fundbox

If you start with a search for alternative small business loans, Fundbox is going to be one of the first to pop up.  It is a line of credit rather than a loan, but it is a great funding option because there is no minimum credit score requirement.

They offer an automated process that is super-fast. Repayments are automatic, meaning they draft them electronically, and they occur on a weekly basis.  One thing to remember is that you could have a repayment as high as 5 to 7% of the amount you have drawn currently, as the repayment period is comparatively short.  This means you need to be sure you have enough funds in whatever account you connect them to so that it can cover your payment each week.

Loan amounts come as low as $100 and as high as up to $100,000, but the max initial draw is $50,000. Though there is no minimum credit score requirement, they do require at least 3 months in business, $50,000 or more in annual revenue, and a business checking account with a minimum balance of $500.

BlueVine

As you find with many alternative business loans, lenders often offer options more similar to invoice factoring and lines of credit, as these present less risk than straight term loans.  This is true of Fundbox as well as BlueVine.

The minimum loan amount available from BlueVine is $5,000 and the maximum is $100,000. Annual revenue must be $120,000 or more and the borrower must be in business for at least 6 months. Personal credit score has to be 600 or above. It is important to note also, that BlueVine does not offer a line of credit in all states.  You can find out more in our review here.

Upstart

Upstart is one of those that uses a completely innovative platform for alternative loans.  The company itself questions the ability of financial information and FICO on their own to truly determine the risk of lending to a specific borrower.  They choose to use a combination of artificial intelligence and machine learning to gather alternative data instead.  They then use this data to help them make credit decisions.

This alternative data can include such things as mobile phone bills, rent, deposits, withdrawals, and even other information less directly tied to finances.  The software they use learns and improves on its own. You can use their online quote tool to play with different amounts and terms to see the various interest rate possibilities.  Typically, business loans are available ranging from $1,000 to $50,000.  Interest rates vary greatly, ranging from 7.5% to 35.99%.  Repayment terms can be either 3 -year or 5-year.

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To be eligible for a loan with Upstart, you must meet the following qualifications:

  • Credit score of 620+
  • No bankruptcies or negative public records
  • No delinquent accounts
  • Meet debt to income standards (they only note they will check this ratio, not what their standards are.)
  • Have fewer than 6 inquiries in the past 6 months on your credit report, not including those related to student loans, vehicle loans, or mortgages

These are the requirements they list on their website.  One independent review said that the requirement for the debt to income ratio is a maximum of 45%. It also says that the minimum annual income has to be at least $12,000.  For more information on Upstart, see our in-depth review here.

Fora Financial

Founded in 2008 by college roommates, Fora Financial now funds more than $1.3 million in working capital around the United States. There is no minimum credit score, and there is an early repayment discount if you qualify.

The minimum loan amount is $5,000 and the maximum is $500,000. The business must be at least 6 months in operation and the monthly revenue has to be $12,000 or more. There can be no open bankruptcies.

OnDeck

Obtaining financing from OnDeck is quick and easy. First, you apply online and receive your decision once application processing is complete. If you receive approval, your loan funds will go directly to your bank account. The minimum loan amount is $5,000 and the maximum is $500,000.

They do require a personal credit score of 600 or more, and you must be in business for at least one year. Annual revenue must be at or exceed $100,000. In addition, there can be no bankruptcy on file in the past 2 years and no unresolved liens or judgements.

Of course, these are just a few options available.  There are tons out there, and many lenders offer multiple types of alternative small business loans.  From term loans and lines of credit to invoice factoring, there are funding options for everyone.

You Still Need Business Credit

Though these lenders generally offer personal credit minimums for requirement standards, some will take business credit into account if you have it.  In addition, you can always get business credit cards with business credit.  The question is, do you have business credit?  If not, how do you get it?

Building business credit is a process that takes time, but it isn’t hard.  You just have to set up your business to appear fundable, and then work to get accounts reporting to your business credit report rather than your personal credit report.  That means applying for credit using your business information rather than your personal information.

Benefits of Business Credit

Business credit allows your business access to funds you never even knew you could get. You can bid on real estate, get new equipment, and cover payroll. This is particularly useful in seasonal companies, where you can go for months with only nominal sales.

These are just a few of the reasons to build business credit. You can’t do that however, unless you know what impacts your business credit score.  How do you even get business credit to begin with?  This is the part of lot of business owners miss.

Establish Business Credit

If you are simply operating as a sole proprietorship, as many small businesses are, you probably do not have business credit.  The reason being, your business transactions are likely being reported on your personal credit report.

To ensure you have a business credit report that is separate from your personal report, you need to separate your business from yourself.  The first step in doing this is to incorporate, no longer operating as a sole proprietor.  You can choose from organizing as a corporation, S-corp, or LLC.  Which one you choose will depend on a variety of factors including the level of liability protection you want and how much you are willing to spend.  However, for the purpose of establishing business credit, any of them will work.

You will also want to be sure you have separate contact information for your business listed in the directories, a dedicated business bank account, and a professional website.  Find out more about establishing your business as an entity separate from yourself for building business credit here.

How to Get Business Credit

After you establish your business as separate from yourself, you will need accounts reporting to the business credit reporting agencies in your business name.  That part is a little trickier, as most places will not extend credit to a business that does not have a credit score.  The key is to use starter vendors from the vendor credit tier.

These are vendors that will extend invoices with net terms even without a credit check and report your payments to the business credit reporting agencies like Dun &Bradstreet, Experian Business, and Equifax.  Find out more about starter vendors here.

Things to Remember When Building Business Credit

Once you have the ball rolling on building business credit, whether to help you get business credit cards, alternative loans, or some other type of funding, keep these things in mind.

  • Paying on time is important

Late payments will affect your business credit score for a good seven years. If you pay your business bills off, as quickly as possible and as completely as possible, then you can make a very real difference when it comes to your credit scores. Be sure to pay in a timely manner and you will reap the rewards of

punctuality.

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  • Your Personal Credit Isn’t Totally Off the Table

Experian Business actually offers lenders a blended score that includes your personal credit history.  While a great business credit score can help counteract a negative personal credit score when it comes to the business score, you should still take steps to improve your personal score.  Find out how here.

  • How much credit you use matters

Do not give in to the temptation to use every bit of credit you have at once.  That will mess with your credit utilization.  This is indicated by your debt-to-credit ratio.  That  indicates how much of your available credit you are using.  If you keep balances close to your limit, it can affect your score negatively.

You Still Need Business Credit, Even if You Can Get Alternative Small Business Loans Without It

If you need funding for your business and do not qualify for loans from a traditional lender, then alternative business loans could be for you.  Their requirements are less stringent than those of traditional lenders, so even if your personal credit score is not great, you could still get one.  However, regardless of whether you have good personal credit, you need to be building business credit.

This will not only extend the benefits already mentioned, but it can also help protect your personal finances.  Despite the fact that your personal credit can at times have a bearing on your business credit, the opposite is typically not true.  So, if there is an issue that affects your business credit, your personal credit should stay intact.

 

 

 

The post 5 Up to the Minute Alternative Small Business Loans appeared first on Credit Suite.