Accounts Receivable Funding

Check Out Accounts Receivable Funding

Are you looking for accounts receivable funding? Even though accounts receivable funding is based on receivables – more on that later – it still pays to look at fundability. Plus we are covering similar alternatives today.

This way in case it turns out that accounts receivable funding is off the table for you and your business, you would still be covered.

Fundability

Fundability is the ability of a business to get funding. It essentially covers all the points a lender or credit provider will be looking at when they’re trying to figure out if you’ll pay back a loan or credit extended to you. These include factors you probably haven’t thought about or might think aren’t so important. But they are!

Your Business name

Does your business include the name of a high risk industry? Did you know it could be preventing you from getting funding? It doesn’t have to be this way. You don’t have to include the name of your industry in your business name. There’s nothing deceptive or illegal or otherwise wrong about calling a business Chico’s rather than Chico’s Bail Bonds.

Note: if you change your business name, be sure to change it everywhere. This means you change it in these places, among others: incorporation documents, licenses, and your records with the business CRAs (D&B, Experian, and Equifax)

It’s best to copy/paste this information. Do not chance making an error by typing it by hand. This is because differences will be interpreted as fraud by lenders and credit providers. Keep records of where your business name is, so, you can be sure you’ve caught everything.

NAICS code

You choose your business’s NAICS code. NAICS industry codes define businesses based on the activities in which they are primarily engaged. The NAICS puts out a list of high-risk and high-cash industries. Higher risk industries include casinos, pawn shops, and liquor stores. If more than one code would apply, there is nothing deceptive, illegal, or wrong with using a less risky one.

The IRS, lenders, banks, insurance companies, and business CRAs use NAICS codes. They are trying to determine if your business is in a high-risk industry classification. So, you could get a denial for a loan or a business credit card based on your business classification. Some codes can trigger automatic turn-downs, higher premiums, and reduced credit limits for your business. See naics.com/search.

Demolish your funding problems with 27 killer ways to get cash for your business.

Business Entity type

To get financing or credit for your business you must have a business entity. A corporation or LLC gives you more credibility in many cases. It also helps you reduce your liability. And it separates you from your business. It makes the business a separate legal entity. Make sure your entity is set up in the same state as your business address.

Your EIN

Your business must have a Federal Tax ID number (EIN). Just like you have a Social Security Number, your business has an EIN. Your Tax ID number is used to open a bank account and to build a business credit profile. Take the time to verify all agencies, banks, and trade credit vendors have your business listed with the same Tax ID number.

Your Business Address

Your business address has to be a real brick and mortar building. It must be a deliverable physical address. This should not be a home address or a PO Box. Don’t use UPS mailing addresses. Some lenders will not approve and fund unless this criterion is met.

Your Business Phone Number

A cell or home phone number as your main business line could get you flagged as un-established – but VOIP is okay. Do not give a personal cell phone or residential phone as the business phone number. Your phone number must be listed with 411 for most credit issuers and lenders to approve you. Check your record to see if you’re listed and make sure your information is accurate. No record? Then use ListYourself.net to get a listing. Business phone number should be toll-free (800 exchange or comparable).

Your Business Licensing

Make sure you have the proper licensing for your corporation. And make sure the address on your licenses is the same as all other documents. Contact State, County, and City Government offices, and see if there are any required licenses and permits to operate your type of business. Being licensed also builds credibility in your business, which can help you get more customers.

Your Business Website and Email

You need a company email address for your business. Email must be on the same domain as your website. This usually comes with a website domain provider such as GoDaddy or Host Gator. It is not just professional; it also greatly helps your chances of getting approval from a credit provider. Do not use Yahoo, AOL, Gmail, Hotmail, or similar kinds of email.

Demolish your funding problems with 27 killer ways to get cash for your business.

Accounts Receivable Funding

You can use outstanding account receivables as collateral for financing. Receivables should be with the government or another business. If you also have purchase orders, you can get financing to have those filled. You won’t need to use your cash flow to do so. Get an accounts receivable credit line with rates of less than 1% with no consumer credit requirement. Receivables should be with the government or another business.

Accounts Receivable Funding: Terms and Qualifying

Use your outstanding account receivables for financing. Get as much as 80% of receivables advanced ongoing in less than 24 hours. Remainder of the accounts receivable are released once the invoice is paid in full. Factor rates as low as 1.33%. you can get an accounts receivable credit line with rates of less than 1% with no consumer credit requirement.

For an Alternative to Accounts Receivable Funding, Try Our Credit Line Hybrid

A credit line hybrid is a form of unsecured funding. Our credit line hybrid has an even better interest rate than a secured loan. Get some of the highest loan amounts and credit lines for businesses. Get 0% business credit cards with stated income. These report to business CRAs. You can build business credit at the same time. This will get you access to even more cash with no personal guarantee.

Credit Line Hybrid: Terms and Qualifying

You need a good credit score or a guarantor with good credit to get an approval (a FICO score of at least 680). No financials required. You can often get a loan of five times the amount of current highest revolving credit limit account. This is up to $150,000.

For a Similar Kind of Funding, Try Purchase Order Financing

This is advanced to a business with a large purchase order or contract but cannot fulfill it. Lender then loans the funds necessary to complete the order and charges a percentage for the service. Then the company can fulfill its order or contract. The difference between purchase order and accounts receivable funding is:

Purchase order financing involves a company lending you money to fulfill purchase orders
Accounts receivable funding involves a company buying your outstanding invoices

Purchase Order Financing: Terms and Qualifying

Terms are for Credit Suite purchase order financing. For approval, lenders will typically review your outstanding purchase orders that need to be filled. If the purchase orders are valid and the suppliers you are dealing with are credible, you can be approved regardless of personal credit history. Rates typically range from 1-4%. In some instances, you can get 95% of your purchase order financed.

Demolish your funding problems with 27 killer ways to get cash for your business.

Consider Cash Flow Financing as Well

A loan made to a company is backed by a company’s expected cash flows. A company’s cash flow is the amount of cash that flows in and out of a business, in a specific period. Cash flow financing (or a cash flow loan) uses generated cash flow as a means to pay back the loan.

Cash Flow Financing: Terms and Qualifying

Often you will need to have a few years in business. You may need to meet a certain minimum credit score requirement. You will need to prove historical cash flow, and present your accounts receivables and accounts payables, so the lender can determine how much to loan to your business.

SBA Seasonal Line

Advances against anticipated inventory and accounts receivables, or in some cases associated increased labor costs. It is meant to help seasonal businesses. It can be revolving or non-revolving.

SBA Seasonal Line: Terms and Qualifying

Get loans to $5 million. Qualification requirements are the same as with other SBA programs. The maximum maturity on this CAPLine loan is 10 years. Holders of at least 20% ownership in the applicant business must guarantee the loan.

So How Do You Choose?

This is an enormous buffet of business funding choices! But how do you select the one(s) that’s best for your particular situation? This is where our Advisory Team comes in extremely handy. Or help yourself with our Business Credit Builder. It’s your choice. But it all starts with business credit.

Accounts Receivable Funding: Takeaways

There are all sorts of amazing ways to get business funding. Accounts receivable funding and similar funding types are just the tip of the iceberg. You can find the best financing which fits your circumstances, including your strengths in areas like:

Personal credit
Collateral or
Cash flow

The post Accounts Receivable Funding appeared first on Credit Suite.

4 New Work from Home Tips To Get The Funding You Need

There are tons of articles on the internet about how to make working from home work for you. How to run a business from home is a popular topic. You don’t need me to give you more ways to organize your work space or keep yourself out of the fridge. No one needs more work from home tips on how to schedule your day and avoid distractions. There are plenty of places to get those.

I’m going to give you something you can’t in every internet search that includes “work from home” and “tips.” I’m going to tell you how to get the funds you need to run your home based business now, and how to ensure you’re set up properly to get more funds in the future.

Little Known Work from Home Tips To Get the Funding You Need for Your Home Based Business

You may think you can just go to the bank and get a home based business loan just like any other loan. However, you may be wrong. If your personal credit score is really high, it’s possible. Yet, home based businesses do not traditionally bode well with lenders. These work from home tips can help your business appear fundable to lenders. They can help you build your business credit score. Even better, they can point you in the direction of the best funding options for work at home businesses.

Check out our best webinar with its trustworthy list of seven vendors to help you build business credit.

Work from Home Tips #1: Work With a Business Credit Expert

This tip comes before all the other tips because frankly, some of them are almost impossible to pull off without a business credit expert. This is someone who can help you:

Assess and improve the fundability of your business.
Guide your toward vendor accounts that will report your consisten, on-time payment to the business credit report agencies and help build your business credit score.
And help you find the best funding for your business that you can get right now, while you work on building your business credit profile and becoming more fundable.

Work from Home Tips #2: Work on Fundability

Working on fundability is essential. This is a tip for any business, but fundability is something that many home based businesses struggle with. There are many factors that affect fundability. Still, home based businesses struggle with a few specifically more than others.

The thing is, a major aspect of fundability is to appear to lenders to be separate from the owner. They want to see that a business is fundable on its own. For this to happen, the first thing you have to do is set up your business to be separate from you the owner.

The Home Based Business and Fundability Conundrum

What makes this an exceptional issue for home based businesses? Well, it’s no secret that one of the major benefits of working from home is not having to pay for an office space. There is no lease, no extra utilities, you just use the space you already have.

In fact, most home-based businesses are run as sole proprietorships with the same contact information as the owner. Many do not even open a separate business bank account at first. Also, it’s quite common for sole proprietor’s to simply use their social security number rather than using an EIN from the IRS.

While there is nothing wrong with any of this, it does not suit the purpose of separating your business from yourself for fundability. To do that, you need a separate phone number and address for your business. Do not think that means you have to have a separate location. You do not. There are ways to get a business home phone number and even a separate business address and still run your business from home. You also need an EIN and business bank account.

You also really need to incorporate as an S-corp, LLC, or corporation. For fundability purposes, it doesn’t matter which one you choose. Discuss the options with your tax professional and attorney. They can help you determine which one is best for your budget and needs for liability protection.

Work from Home Tips #3: Open Accounts that Report to Your Business Credit Profile

If you set your business up to be fundable, it will also be set up the way it needs to be to establish a business credit profile. This means you can start to build your business credit score separate from your personal credit score.

Here is how it works. You have to open accounts in your business name, using your business contact information and your EIN, not your SSN. The catch is, they need to be accounts that will report to the business credit reporting agencies.

Check out our best webinar with its trustworthy list of seven vendors to help you build business credit.

This is easier said than done, as most vendors do not make it easy for the general public to figure out whether they do this. In fact, many do not report, which makes this particular tip harder. In the beginning, you have to find vendors that will extend credit and report payments without checking your credit. That is, if your personal credit isn’t good.

This is one tip where a business credit expert can be especially helpful. These experts know many vendors that will report. They also know which ones you qualify for an account with right now. Even better, they know how to position you so that you can be eligible for more accounts in the future.

Work from Home Tips #4: Home Based Business Loans

With strong fundability you’ll be able to get pretty much any funding your business could ever need, even if it is a home-based business. However, in the beginning, some loans are going to work better than others. Here are some examples.

Credit Line Hybrid

With the Credit Line Hybrid, you can usually get a loan of 5x the amount of your highest revolving credit limit account, up to $150,000. Honestly, this is more than what you could get on your own when applying for credit cards. Furthermore, you can get cash out on this program.

Also, there is no impact on your personal credit with this type of financing. You need a 680+ credit score, but if you don’t meet that you can take on a credit partner who does. A lot of business owners use the good credit of friends or family to help them get the funding they need.

It does not affect your personal credit score at all. In fact, it can help build your business credit score if your business is set up properly as mentioned above.

401K Financing

Your existing 401(k) or IRA can help fund your business as well. The funds work as collateral for business financing. As a result, your personal credit score isn’t really an issue. This program uses IRS proven strategies. You will pay no tax penalties, and you still earn interest on your 401(k). Even better, rates are low, and this option usually has a quick closing and funding process. If you are currently struggling to fund your home-based business, this is an excellent way to get started.

Check out our best webinar with its trustworthy list of seven vendors to help you build business credit.

SBA 7 (a) Loan

The SBA offers federally funded term loans up to $5 million. The funds can be used for expansion, purchasing equipment, working capital and more. Banks, credit unions, and other specialized institutions process these loans and disburse the funds.

Credit Suite business credit experts can help you with these types of funding and more!

A Business Credit Expert Can Help You With These Tips and So Much More

While there are plenty of work from home benefits, there are also some disadvantages of working from home. If you want to work from home, you have to find a way to overcome these work from home challenges. If you are running your business from home, one of the greatest of these challenges is funding your business. A Credit Suite business credit expert can help.

The post 4 New Work from Home Tips To Get The Funding You Need appeared first on Credit Suite.

Business Funding Options

What are the Best Business Funding Options for Your Business?

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What are All the Different Types of Business Funding Options?

There are several different types of business funding options out there.

The best way to start figuring out which choice is right for your business is to figure out what’s available. Did you know that traditional bank loans are not your only option?

Types of Business Funding Options

There are many more, including:

SBA loans
401(k) financing
Merchant Cash Advances
Equipment Financing
The Credit Line Hybrid
Traditional Lines of Credit

Let’s dive in to each one and figure out which one is best for your business right now

Business Funding Options: SBA Loans

Guaranteed by the federal government. Issued by participating lenders, usually banks. They offer a lot of the perks of traditional loans, such as lower interest rates and favorable terms. Due to government guarantee, lenders are able to offer them to those with a lower credit score than would typically be required.

Eligibility for SBA Loans

Lenders and loan programs have unique eligibility requirements. In general, eligibility is based on what a business does to receive its income, the character of its ownership, and where the business operates. Hence even those with bad credit may qualify for startup funding.

Normally, businesses must meet size standards, be able to repay, and have a sound business purpose. The lender will provide you with a full list of eligibility requirements for your loan. See www.sba.gov/document/support–table-size-standards.

More About Eligibility for SBA Loans

General eligibility also includes:

Being a for-profit business – the business must be officially registered and operating legally
Doing business in the US – the business must be physically located and operating in the US or its territories
Having vested equity – the owner must have invested their own time or money in the business
Exhausting other funding options – the business must not be able to get funds from any other financial lender

Ideal credit scores for an SBA loan are 680 or above. There are a number of SBA loan programs, each one designed to work for different needs and situations. Some of the most common SBA loan programs include:

7(a) loans
504 loans
Microloans
Disaster loans
Express loans

These are just a few the of the options available. Find out more at SBA.gov.

Demolish your funding problems with 27 killer ways to get cash for your business.

Which SBA Loan is Best?

SBA loans each have a specific purpose. For example, if your business has suffered due to a natural disaster, you need a disaster loan. If you need $50,000 or less, a microloan may be the best option. But the 7(a) loan program is the most versatile.

SBA 7 (a) Loans

This the SBA’s most popular loan. The SBA guarantees 85% for loans up to $150,000, and 75% for loans greater than $150,000. The SBA makes the lending decision, but qualified lenders may be granted delegated authority to make credit decisions without SBA review.

SBA 7(a): Terms and Qualifying

The maximum amount on offer is $5 million. You will have to provide Articles of Organization, business licenses, documentation of lawsuits, judgments and bankruptcy or other pertinent documentation. Lenders are not required to take collateral for loans up to $25,000. For loans in excess of $350,000, the SBA requires that the lender collateralize the loan to the maximum extent possible up to the loan amount.

SBA 504 Loans

The SBA 504 loan program is an economic development loan program that offers small businesses an avenue for business financing, while promoting business growth, and job creation. This program provides approved small businesses with long-term, fixed-rate financing used to acquire fixed assets for expansion or modernization.

Use it to buy currently existing buildings, construct new buildings, and more. See sba.gov/offices/headquarters/ofa/resources/4049.

SBA 504: Terms and Qualifying

For corporations, anyone with a 20% ownership stake (or more) must fill out the application. This includes swearing they are not under indictment for any criminal offense. In general, the SBA provides 40% of the total project costs, a participating lender covers up to 50% of the total project costs, and the borrower contributes 10% of the project costs. Under certain circumstances, a borrower may be required to contribute up to 20% of the total project costs

Who Do SBA Loans Work Best For?

These loans work well for those that are not in a hurry to get funding

The approval and funding process can take a while, especially with the government red tape required for the government guarantee. If you can wait, meet all the requirements, and want a more traditional type of loan, SBA loans are an option.

Demolish your funding problems with 27 killer ways to get cash for your business.

Business Funding Options: 401(k) Financing

If you have an eligible 401(k), you can use those funds to get money for your business. You can even still earn interest on your account, and there are no tax penalties. Personal credit doesn’t really matter much. Interest rates are usually low.

This is not a loan. You will not have to pay an early withdrawal fee or a tax penalty. You put the money back by contributing, just like with any 401(k) program. This means you won’t lose your retirement funds. This is a 401(k) Rollover for Working Capital program. The IRS calls it a Rollover for Business Startups (ROBS).

Per the IRS, a ROBS qualified plan is a separate entity with its own set of requirements. The plan, through its company stock investments, rather than the individual owns the trade or business. Therefore, some filing exceptions for individuals may not apply to such a plan. This type of financing isn’t a loan against, your 401(k), so there’s no interest to pay. It does not use the 401(k) or stocks as collateral. Instead, this is simply a movement or change of custodian.

401(k) Financing Details

In fact, they are often less than 5%. Close and fund in less than 3 weeks. Can usually get up to 100% of what’s “rollable” within your 401(k). This type of loan works well for anyone that has an eligible 401(k) account. Your 401(k) will need to have more than $35,000 in it. The 401(k) you use cannot be from a business where you are currently employed. So it will need to be from older employment. You cannot be currently contributing to it.

Business Funding Options: Merchant Cash Advances

Businesses that accept credit cards as a form of payment may qualify for a merchant cash advance. This means your business must have a merchant account in order to be able to accept credit card payments. Your business must bring in $100,000 or more per year in credit card sales. Typical approval is equal to one month’s credit processing volume. The minimum credit score is 500.

Merchant Cash Advances: Terms and Qualifying

A lender will review 3 months of bank and merchant account statements. They are looking for is consistent deposits. And they want to see deposits showing revenue is $50,000 or higher per year. They will also verify time in business of 6 months or more.

Lenders are also looking to see that you don’t have a lot of Non-Sufficient-Funds (NSFs) showing on your bank statements. They want to see you don’t have a lot of chargebacks on your merchant statements. And they want to see that you have more than 10 deposits in a month going into your bank account.

In essence, they want to see that you manage your bank and merchant accounts responsibly. And they want to see that have a decent number of consistent credit card transaction deposits each month.

Business Funding Options: Equipment Financing

Equipment financing is when you use a loan or lease to purchase or borrow hard assets for your business. It is a business financing option you can use to buy any physical asset. Physical assets can include items such as a restaurant oven or a company car. You will predictable amounts every month. You can build business credit on a program such as this.

Equipment Financing: Terms and Qualifying

All terms are for equipment financing through Credit Suite. Companies must have at least one year in business. You can get approved even with challenged credit. You won’t need financials to secure equipment financing. Approvals take as little as 24 hours.

Business Funding Options: Credit Line Hybrid

Credit Line Hybrid: Terms and Qualifying

Who Does the Credit Line Hybrid Work Best For?

This is a good option for virtually everyone. Because even if you have bad credit, you can get funding by using a credit partner. Works especially well for those who need to build business credit. See www.creditsuite.com/business-loans.

Demolish your funding problems with 27 killer ways to get cash for your business.

Business Funding Options: A Line of Credit from Fundbox

Fundbox will connect directly to your online accounting software. That’s all you need to do. You can get invoice financing or a line of credit. See fundbox.com.

Fundbox: Terms and Qualifying

Get a revolving line of credit for up to $150,000. Fundbox will auto debit your weekly payment from your bank account. You don’t need to show a minimum personal credit score, and you don’t need to show a minimum time in business.

Business Funding Options: Takeaways

There are a ton of choices for business financing. These merely scratch the surface. Contact us today to learn more.

The post Business Funding Options appeared first on Credit Suite.

Think Outside the Box When Choosing Business Funding Companies

When you think of business funding companies, you are probably thinking about traditional financing institutions. Large banks, community banks, credit unions and such definitely do offer business loans. However, if you are a small business, you may need to think outside of the traditional funding box a bit.

Business Funding Companies Come in Many Forms

There are many different options when it comes to funding your business. There are private lenders, which you may have heard referred to as alternative lenders. There are cash advance options which are bad news on all fronts, but especially for funding a business. What you probably haven’t heard of however, is the small niche of business funding companies that do more than just offer business financing. In addition, they offer help improving fundability. This may include consultation, coaching, educational opportunities, and more.

These companies not only help you find the financing you need now, but they can also help you improve business credit and fundability so that you qualify for more and better funding throughout the life of your business.

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

Business Funding Companies: Credit Suite

This is exactly what Credit Suite does. A business credit expert will consult with you to help determine where you currently stand in regards to fundability. Then, they can not only help you find the best business funding for you now, but they can help you improve your fundability to ensure you qualify for even more funding, with better terms!

A business credit expert can help you in ways you probably do not even realize. They have an inside track to what lenders are actually looking for. They can also help you steer clear of predatory lenders, which are all too prevalent in the world of business funding companies. These experts are also aware of which lenders report to business credit reports to help build business credit, which ones do not require a person credit check or guarantee, and more.

Working with a business credit expert will save you time, and in the long-term, money. The cost far outweighs the benefit, and you definitely get a bigger bank for your buck.

Business Funding Companies: Alternative (Private) Lenders

The vast sea of alternative lenders is hard to swim in. It is full of sharks that are searching for easy prey in the form of small businesses that need money. If you aren’t careful, you will get swallowed up quickly. Unfortunately, the industry is wrought with predatory lending practices.

The key is to find a legitimate business funding company that fits your current needs. A business credit expert is the best way to do this, but here are some good options from U.S. News and World Report to give you an idea of what is out there.

As with all loans, rate, fees, minimums, maximums, terms, and other details can change without notice Be sure to check with the lender directly for the most up to date information.

BlueVine

Loans are available from BlueVine up to $100,000. Annual revenue must be $120,000 or more and the borrower must be in business for at least 6 months. Your 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.

Funding Circle

At Funding Circle, borrow up to$500,000. Decisions come in as little as 24 hours, and you can get funding in as little as 5 days. Repay on terms from 6 months to 5 years.

Funding Circle’s rates start at 4.99% per year. There are no prepayment penalties, there are also relatively fast decisions and funding.

They do have a ton of fees, including for origination, missing payments, and insufficient funds. Also, some maximum rates are high!

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 can be up to $500,000.

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

Just like any other online lender, they do have certain requirements to qualify for a loan. For example, a personal credit score of 600 or more. Also, 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.

Rapid Finance

Rapid Finance offers a couple of different options. Which one is right for you will depend on a number of variables.

Small Business Term Loans

These range up to $1 million in funding, with terms from 3 to 60 months. Your business needs to be generating revenue to qualify.

You will need to supply a government-issued ID (like a driver’s license), a void check from your business banking account, and the last three statements from your business bank account.

Merchant Cash Advances

You can get up to $500,000 in funding. In a merchant cash advance. This is funding based on your average daily credit card sales.

You will need to supply a government-issued ID (like a driver’s license), a void check from your business banking account, your last three credit card processing statements, and the last three statements from your business bank account to apply for this.

Bad credit is no problem with this type of funding because typically, repayment is taken directly from credit card sales.

Credit Line Hybrid: Out of the Box Business Funding

In addition to the lines of credit, merchant cash advances, and invoice funding that many alternative lenders offer, you might also try a credit line hybrid. This is unsecured business financing. It is also no-doc financing. That means you need no collateral and you do not have to turn in any financial statement documents like bank statements or check stubs to qualify.

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

You do need a 680+ credit score and there are a few other requirements. However, if you don’t meet them all you can choose to use a credit partner. This could be a friend, family member, or partner that does meet the requirements. You can use their good credit to apply for the credit line hybrid, but the payments would still be reported in the name of the business thus building business credit.

Business Funding Companies Are Not Always What You Think

It’s not always about a bank or a credit union. You may need to think outside the box for a number of reasons. Maybe you want an option without collateral. Maybe you want to use non-traditional types of collateral such as invoices. Perhaps you do not qualify for a loan at a traditional bank.

Whatever the reason, there are a number of options, and sometimes alternative lenders are the answer. However, this industry has a fair share of predatory lenders. The best ways to avoid the sharks is to work with one of the business funding companies that can help with more than funding.

The business credit experts at a company like this offer not only help finding the perfect funding for your needs right now, but also can help assess and improve business credit and overall fundability.

The post Think Outside the Box When Choosing Business Funding Companies appeared first on Credit Suite.

Need Funding? Our Credibly Recession Financing Review Can Save Your Business

Get the Funding Your Business Craves with Our Credibly Recession Financing Review

If you’ve been looking for a Credibly recession funding review, then look no further.

Credibly is one of several online lending companies. They are actually an emerging Fintech platform. They also provide SBA PPP loans.

Credibly can provide small business funding for working capital or small business expansion. You can also get a line of credit through them, equipment financing, invoice factoring, and merchant cash advances.

Credibly Recession Funding Review: Background

Credibly is located online here: www.credibly.com. Their physical addresses are located in Southfield, Michigan; New York, New York; and Scottsdale, Arizona. You can call them at: (888) 664-1444. Their contact page is here: www.credibly.com/contact.

You can email them at: customerservice@credibly.com.

Credibly Recession Funding Review: Qualification Requirements

Your company has to in business for at least 6 months at the minimum. In addition, you need to have at least $15,000 in monthly revenue. You must have a personal credit score of 500 or better.

Credibly also will want to review your most recent three months’ worth of bank statements while they consider whether to grant your application for funding.

Credibly offers $5,000 to $400,000 in funding. Get money fast – within 24 – 48 hours.

Credibly will perform a soft credit pull only to check your qualifications. But before you receive funding, Credibly will do a hard pull which will appear on your credit profile and may affect your credit score.

In addition, they will want a personal guarantee. They do not require you to provide collateral.

Credibly Recession Funding Review: Working Capital Loans

Get up to $400,000 in funding. Terms are 6 to 18 months. Pay factor rates as low as 1.15. For loans over $100,000, they want to see your most recent business tax return.

Credibly Recession Funding Review: Business Expansion Loans

Get up to $250,000 in funding. Terms are 18 or 24 months. Interest rates start at 9.99%. You must have a FICO score of 600 or better and three or more years in business. Also, you must have $3,000 or more in average daily balances.

Credibly Recession Funding Review: Fees

Pay a one-time 2.5% of the total loan amount set up fee. This fee is deducted from your proceeds. Rates start at 9.99%.

Credibly Recession Funding Review: Lines of Credit. Invoice Factoring, and Equipment Financing

These forms of funding are only available through Credibly’s network of external funding partners.

Credibly Recession Funding Review: Merchant Cash Advances

Get up to $400,000 in funding. Duration is anticipated to be 3 to 18 months. Pay factor rates as low as 1.15. Automatic remittances are tied to your receivables.

Credibly Recession Funding Review: Advantages

Advantages include a short time in business requirement. A short time to funding is also attractive.

Credibly Recession Funding Review: Disadvantages

One set of disadvantages are that they will want a personal guarantee and they will do a hard pull on your personal credit.

For startup companies and their founders in particular, who are often on some shaky financial ground to begin with, this could prove problematic. For these sorts of companies and business owners, a better choice might be to try crowdfunding or angel investing if either is possible. In that way, a business owner’s personal assets would be safer. And, their personal credit would not be affected.

A Viable Alternative – Building Business Credit

Business credit is credit in a small business’s name. It doesn’t attach to a business owner’s personal credit, not even when the owner is a sole proprietor and the solitary employee of the small business.

Hence, a business owner’s business and individual credit scores can be very different.

The Advantages

Because company credit is independent from personal, it helps to secure a small business owner’s personal assets, in the event of court action or business insolvency.

Also, with two distinct credit scores, a business owner can get two separate cards from the same merchant. This effectively doubles purchasing power.

Another benefit is that even startup ventures can do this. Going to a bank for a business loan can be a recipe for disappointment. But building company credit, when done correctly, is a plan for success.

Personal credit scores depend on payments but also various other components like credit use percentages.

But for business credit, the scores truly merely depend on if a small business pays its bills timely.

Discover our business credit and finance guide, jam-packed with new ways to finance your business without emptying your wallet. Save your money during the recession!

The Process

Establishing company credit is a process, and it does not occur automatically. A business needs to actively work to establish company credit.

Nevertheless, it can be done readily and quickly, and it is much swifter than developing consumer credit scores.

Vendors are a big component of this process.

Performing the steps out of sequence will cause repetitive denials. Nobody can start at the top with business credit. For instance, you can’t start with retail or cash credit from your bank. If you do, you’ll get a denial 100% of the time.

Company Fundability

A company needs to be fundable to lending institutions and vendors.

Consequently, a company will need a professional-looking web site and e-mail address. And it needs to have site hosting bought from a company like GoDaddy.

Additionally, company phone numbers must have a listing on 411.com. Use ListYourself to get a listing.

Likewise, the business phone number should be toll-free (800 exchange or similar).

A business will also need a bank account dedicated solely to it, and it must have every one of the licenses essential for operation.

Licenses

These licenses all have to be in the particular, correct name of the company. And they need to have the same company address and phone numbers.

So note, that this means not just state licenses, but possibly also city licenses.

Discover our business credit and finance guide, jam-packed with new ways to finance your business without emptying your wallet. Save your money during the recession!

Dealing with the IRS

Visit the Internal Revenue Service web site and obtain an EIN for the company. They’re free. Pick a business entity such as corporation, LLC, etc.

A business can get started as a sole proprietor. But they will most likely wish to switch to a type of corporation or an LLC.

This is in order to decrease risk. And it will optimize tax benefits.

A business entity will matter when it involves taxes and liability in case of litigation. A sole proprietorship means the entrepreneur is it when it comes to liability and tax obligations. Nobody else is responsible.

Sole Proprietors Take Note

If you run a business as a sole proprietor, then at least be sure to file for a DBA. This is ‘doing business as’ status.

If you do not, then your personal name is the same as the company name. Hence, you can find yourself being directly responsible for all small business financial obligations.

Plus, according to the Internal Revenue Service, using this structure there is a 1 in 7 chance of an IRS audit. There is a 1 in 50 probability for corporations! Prevent confusion and dramatically reduce the odds of an Internal Revenue Service audit simultaneously.

Any DBA should be a stepping stone to incorporating.

Starting Off the Business Credit Reporting Process

Start at the D&B web site and get a free D-U-N-S number. A D-U-N-S number is how D&B gets a small business in their system, to generate a PAYDEX score. If there is no D-U-N-S number, then there is no record and no PAYDEX score.

Once in D&B’s system, search Equifax and Experian’s websites for the small business. You can do this at www.creditsuite.com/reports. If there is a record with them, check it for accuracy and completeness. If there are no records with them, go to the next step in the process.

In this manner, Experian and Equifax will have activity to report on.

Vendor Credit

First you ought to build trade lines that report. This is also referred to as vendor credit. Then you’ll have an established credit profile, and you’ll get a business credit score.

And with an established business credit profile and score you can begin to get retail and cash credit.

These types of accounts have the tendency to be for the things bought all the time, like marketing materials, shipping boxes, outdoor work wear, ink and toner, and office furniture.

But to start with, what is trade credit? These trade lines are credit issuers who will give you starter credit when you have none now. Terms are in most cases Net 30, versus revolving.

Therefore, if you get an approval for $1,000 in vendor credit and use all of it, you need to pay that money back in a set term, like within 30 days on a Net 30 account.

Discover our business credit and finance guide, jam-packed with new ways to finance your business without emptying your wallet. Save your money during the recession!

Details

Net 30 accounts must be paid in full within 30 days. 60 accounts need to be paid completely within 60 days. Unlike with revolving accounts, you have a set time when you have to pay back what you borrowed or the credit you made use of.

To kick off your business credit profile the proper way, you should get approval for vendor accounts that report to the business credit reporting agencies. When that’s done, you can then make use of the credit.

Then repay what you used, and the account is on report to Dun & Bradstreet, Experian, or Equifax.

Vendor Credit – It Helps

Not every vendor can help in the same way true starter credit can. These are vendors that will grant an approval with nominal effort. You also want them to be reporting to one or more of the big three CRAs: Dun & Bradstreet, Equifax, and Experian.

You want 3 of these to move onto the next step, which is retail credit.

Retail Credit

Once there are 3 or more vendor trade accounts reporting to at least one of the CRAs, then move onto retail credit. These are companies which include Office Depot and Staples.

Only use your SSN and date of birth on these applications for verification purposes. For credit checks and guarantees, use the company’s EIN on these credit applications.

Fleet Credit

Are there more accounts reporting? Then progress to fleet credit. These are companies like BP and Conoco. Use this credit to purchase fuel, and to fix and maintain vehicles. Just use your SSN and date of birth on these applications for verification purposes. For credit checks and guarantees, make certain to apply using the company’s EIN.

Cash Credit

Have you been responsibly handling the credit you’ve up to this point? Then move onto more universal cash credit. These are businesses like Visa and MasterCard. Only use your Social Security Number and date of birth on these applications for verification purposes. For credit checks and guarantees, use your EIN instead.

These are typically MasterCard credit cards. If you have more trade accounts reporting, then these are attainable.

Monitor Your Business Credit

Know what is happening with your credit. Make sure it is being reported and take care of any mistakes ASAP. Get in the practice of checking credit reports. Dig into the details, not just the scores.

We can help you monitor business credit at Experian and D&B for 90% less.

Update Your Record

Update the data if there are inaccuracies or the information is incomplete. At D&B, you can do this at: https://iupdate.dnb.com/iUpdate/viewiUpdateHome.htm. For Experian, go here: www.experian.com/small-business/business-credit-information.jsp. And for Equifax, go here: www.equifax.com/business/small-business.

Fix Your Business Credit

So, what’s all this monitoring for? It’s to challenge any problems in your records. Errors in your credit report(s) can be fixed. But the CRAs often want you to dispute in a particular way.

Disputes

Disputing credit report errors generally means you mail a paper letter with copies of any proofs of payment with it. These are documents like receipts and cancelled checks. Never mail the originals. Always mail copies and keep the original copies.

Fixing credit report errors also means you precisely detail any charges you challenge. Make your dispute letter as understandable as possible. Be specific about the problems with your report. Use certified mail so that you will have proof that you mailed in your dispute.

A Word about Building Business Credit

Always use credit responsibly! Don’t borrow more than what you can pay back. Track balances and deadlines for payments. Paying punctually and in full will do more to raise business credit scores than just about anything else.

Establishing business credit pays off. Good business credit scores help a small business get loans. Your credit issuer knows the company can pay its debts. They recognize the company is for real.

The business’s EIN connects to high scores and lenders won’t feel the need to ask for a personal guarantee.

Business credit is an asset which can help your company in years to come. Learn more here and get started toward establishing business credit.

Credibly Recession Funding Review: Takeaways

Companies that do best on Credibly will be fairly new players but with relatively meteoric rises.

A business owner asking for a loan should be prepared for a hard pull on his or her personal credit scores, which will impact those scores. This is just like all hard pulls do.

If an entrepreneur does not have the wherewithal to ride out a slightly lower personal credit score for a couple of years, then Credibly is not for them.

And finally, as with every other lending program, whether online or offline, remember to read the fine print and do the math. Go over the details with care. Decide if this option will be good for you and your company.

In addition, consider alternative financing options that go beyond just lending. These include building business credit and unsecured business financing. This is in order to best decide how to get the money you need to help your business grow.

Today, we want to hear from our audience! Share your voice with us about your experiences with online lenders and give us your own Credibly review.

The post Need Funding? Our Credibly Recession Financing Review Can Save Your Business appeared first on Credit Suite.

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Need Funding? Our Credibly Recession Financing Review Can Save Your Business

Get the Funding Your Business Craves with Our Credibly Recession Financing Review If you’ve been looking for a Credibly recession funding review, then look no further. Credibly is one of several online lending companies. They are actually an emerging Fintech platform. They also provide SBA PPP loans. Credibly can provide small business funding for working … Continue reading Need Funding? Our Credibly Recession Financing Review Can Save Your Business

Need Funding? Our Credibly Recession Financing Review Can Save Your Business

Get the Funding Your Business Craves with Our Credibly Recession Financing Review

If you’ve been looking for a Credibly recession funding review, then look no further.

Credibly is one of several online lending companies. They are actually an emerging Fintech platform. They also provide SBA PPP loans.

Credibly Recession Funding Review: Background

You can email them at: customerservice@credibly.com.

Credibly Recession Funding Review: Qualification Requirements

Your company has to in business for at least 6 months at the minimum. In addition, you need to have at least $15,000 in monthly revenue. You must have a personal credit score of 500 or better.

Credibly also will want to review your most recent three months’ worth of bank statements while they consider whether to grant your application for funding.

Credibly offers $5,000 to $400,000 in funding. Get money fast – within 24 – 48 hours.

In addition, they will want a personal guarantee. They do not require you to provide collateral.

Credibly Recession Funding Review: Working Capital Loans

Get up to $400,000 in funding. Terms are 6 to 18 months. Pay factor rates as low as 1.15. For loans over $100,000, they want to see your most recent business tax return.

Credibly Recession Funding Review: Business Expansion Loans

Credibly Recession Funding Review: Fees

Pay a one-time 2.5% of the total loan amount set up fee. This fee is deducted from your proceeds. Rates start at 9.99%.

Credibly Recession Funding Review: Lines of Credit. Invoice Factoring, and Equipment Financing

These forms of funding are only available through Credibly’s network of external funding partners.

Credibly Recession Funding Review: Merchant Cash Advances

Get up to $400,000 in funding. Duration is anticipated to be 3 to 18 months. Pay factor rates as low as 1.15. Automatic remittances are tied to your receivables.

Credibly Recession Funding Review: Advantages

Advantages include a short time in business requirement. A short time to funding is also attractive.

Credibly Recession Funding Review: Disadvantages

One set of disadvantages are that they will want a personal guarantee and they will do a hard pull on your personal credit.

A Viable Alternative – Building Business Credit

Hence, a business owner’s business and individual credit scores can be very different.

The Advantages

Because company credit is independent from personal, it helps to secure a small business owner’s personal assets, in the event of court action or business insolvency.

Also, with two distinct credit scores, a business owner can get two separate cards from the same merchant. This effectively doubles purchasing power.

Personal credit scores depend on payments but also various other components like credit use percentages.

But for business credit, the scores truly merely depend on if a small business pays its bills timely.

Discover our business credit and finance guide, jam-packed with new ways to finance your business without emptying your wallet. Save your money during the recession!

The Process

Establishing company credit is a process, and it does not occur automatically. A business needs to actively work to establish company credit.

Nevertheless, it can be done readily and quickly, and it is much swifter than developing consumer credit scores.

Vendors are a big component of this process.

Company Fundability

A company needs to be fundable to lending institutions and vendors.

Consequently, a company will need a professional-looking web site and e-mail address. And it needs to have site hosting bought from a company like GoDaddy.

Additionally, company phone numbers must have a listing on 411.com. Use ListYourself to get a listing.

Likewise, the business phone number should be toll-free (800 exchange or similar).

A business will also need a bank account dedicated solely to it, and it must have every one of the licenses essential for operation.

Licenses

These licenses all have to be in the particular, correct name of the company. And they need to have the same company address and phone numbers.

So note, that this means not just state licenses, but possibly also city licenses.

Discover our business credit and finance guide, jam-packed with new ways to finance your business without emptying your wallet. Save your money during the recession!

Dealing with the IRS

Visit the Internal Revenue Service web site and obtain an EIN for the company. They’re free. Pick a business entity such as corporation, LLC, etc.

A business can get started as a sole proprietor. But they will most likely wish to switch to a type of corporation or an LLC.

This is in order to decrease risk. And it will optimize tax benefits.

Sole Proprietors Take Note

If you run a business as a sole proprietor, then at least be sure to file for a DBA. This is ‘doing business as’ status.

If you do not, then your personal name is the same as the company name. Hence, you can find yourself being directly responsible for all small business financial obligations.

Any DBA should be a stepping stone to incorporating.

Starting Off the Business Credit Reporting Process

In this manner, Experian and Equifax will have activity to report on.

Vendor Credit

First you ought to build trade lines that report. This is also referred to as vendor credit. Then you’ll have an established credit profile, and you’ll get a business credit score.

And with an established business credit profile and score you can begin to get retail and cash credit.

These types of accounts have the tendency to be for the things bought all the time, like marketing materials, shipping boxes, outdoor work wear, ink and toner, and office furniture.

But to start with, what is trade credit? These trade lines are credit issuers who will give you starter credit when you have none now. Terms are in most cases Net 30, versus revolving.

Therefore, if you get an approval for $1,000 in vendor credit and use all of it, you need to pay that money back in a set term, like within 30 days on a Net 30 account.

Discover our business credit and finance guide, jam-packed with new ways to finance your business without emptying your wallet. Save your money during the recession!

Details

Then repay what you used, and the account is on report to Dun & Bradstreet, Experian, or Equifax.

Vendor Credit – It Helps

You want 3 of these to move onto the next step, which is retail credit.

Retail Credit

Once there are 3 or more vendor trade accounts reporting to at least one of the CRAs, then move onto retail credit. These are companies which include Office Depot and Staples.

Only use your SSN and date of birth on these applications for verification purposes. For credit checks and guarantees, use the company’s EIN on these credit applications.

Fleet Credit

Cash Credit

These are typically MasterCard credit cards. If you have more trade accounts reporting, then these are attainable.

Monitor Your Business Credit

Know what is happening with your credit. Make sure it is being reported and take care of any mistakes ASAP. Get in the practice of checking credit reports. Dig into the details, not just the scores.

We can help you monitor business credit at Experian and D&B for 90% less.

Update Your Record

Fix Your Business Credit

So, what’s all this monitoring for? It’s to challenge any problems in your records. Errors in your credit report(s) can be fixed. But the CRAs often want you to dispute in a particular way.

Disputes

A Word about Building Business Credit

Establishing business credit pays off. Good business credit scores help a small business get loans. Your credit issuer knows the company can pay its debts. They recognize the company is for real.

The business’s EIN connects to high scores and lenders won’t feel the need to ask for a personal guarantee.

Business credit is an asset which can help your company in years to come. Learn more here and get started toward establishing business credit.

Credibly Recession Funding Review: Takeaways

Companies that do best on Credibly will be fairly new players but with relatively meteoric rises.

A business owner asking for a loan should be prepared for a hard pull on his or her personal credit scores, which will impact those scores. This is just like all hard pulls do.

If an entrepreneur does not have the wherewithal to ride out a slightly lower personal credit score for a couple of years, then Credibly is not for them.

Today, we want to hear from our audience! Share your voice with us about your experiences with online lenders and give us your own Credibly review.

The post Need Funding? Our Credibly Recession Financing Review Can Save Your Business appeared first on Credit Suite.

How to Get Funding for Your Business

Need to know how to get funding for your business? Of course, you do! There is so much to consider. For example, what stage your business is in and overall fundability each makes a difference. Most people know that though. The big question is, what exactly is fundability? More than that, what exactly affects fundability? … Continue reading How to Get Funding for Your Business

Stop! Before You Borrow, Check Out Our Fundera Review for Better Recession Funding

Recession Age Funding The number of American banks as well as thrifts has been decreasing slowly for a quarter of a century. This is from consolidation in the marketplace in addition to deregulation in the 1990s, reducing barriers to interstate banking. See: fundera.com/blog/happened-americas-small-businesses-financial-crisis-six-years-start-crisis-look-back-10-charts. Assets concentrated in ever‐larger banks is problematic for small business proprietors. Big … Continue reading Stop! Before You Borrow, Check Out Our Fundera Review for Better Recession Funding

How to Get Funding for Your Business

Need to know how to get funding for your business? Of course, you do! There is so much to consider. For example, what stage your business is in and overall fundability each makes a difference. Most people know that though. The big question is, what exactly is fundability? More than that, what exactly affects fundability? That’s getting a little ahead of things though. You have to know what types of funds are available, and you need to know your fundability makes you eligible for whatever you need.

All the Ways to Get Funding for Your Business and What You Need to Know About Each One

The first step is to figure out what type of funding will work best for you at this current stage in your business. The next step? That would be to figure out whether you qualify, and if not, how to fix that. Here’s what you need to know.

Demolish your financing problems with 27 killer ways to get cash for your business.

Types of Funding

Before you can figure out what type of funding you need, you have to know what type of funds are out there.

Traditional Term Loans

These are loans from traditional banks and credit unions. As a business, your business credit score can help you get some types of funds even if your personal score isn’t awesome. That isn’t necessarily the case with this type of cash however.

With a traditional lender term loan, you are almost always going to have to give a personal guarantee. This means they will check your personal credit. If your personal credit score isn’t in order, you’ll probably have trouble.

So how high does your credit score have to be? If you have at least a 750 you are in pretty good shape. Sometimes you can get approval with a score of 700+, but the terms will not be as favorable.

If you have really great business credit, your lender might be willing to be more flexible. However, your personal credit score will still weigh heavily on the terms and interest rate.

These are the hardest types of funds to get, but they typically have the best rates and terms.

SBA Loans

SBA loans are traditional bank loans, but they have a guarantee from the federal government. The Small Business Administration, or SBA, works with lenders to offer small businesses financing solutions that they may not be eligible for based on their own credit history. Because of the government guarantee, lenders are able to be more flexible with personal credit score requirements.

In fact, it is possible to get an SBA microloan with a personal credit score between 620 and 640. These are very small loans, up to $50,000. They may require personal collateral as well.

The trade-off with SBA loans is that the application process is lengthy. There is a ton of red tape connected with these types of loans.

Business Line of Credit

This is basically the traditional lender’s version of a business credit card. The credit is revolving, meaning you only pay back what you use, just like a credit card. Rates are typically much better than a credit card. The application and approval process, however, is more similar to that of a traditional term loan.

If you need revolving credit and can qualify for a term loan, this is the best of the available business money types for you. It is great for bridging cash gaps and covering short term expenses without the high credit card interest rates.

There are no cash back rewards or loyalty points, though. This makes some business owners prefer business credit cards in some cases.

Invoice Factoring

If you are an established business with accounts receivable, invoice factoring is one type of financing that you have access to. This is where the lender buys your outstanding invoices at a premium, and then collects the full amount themselves. You get cash right away, without waiting for your customers to pay the invoices.

This is a good option if you need cash fast, or you do not qualify for other types of funds. The interest rate varies based on the age of the receivables.

Private Lenders

These are lenders other than traditional banks and credit unions that offer terms loans. Usually they operate online. The difference between these guys and traditional lenders is that the loans have less strict approval requirements. In addition, the application process is usually much faster. Most often you can simply apply online, get approval in as little as 24 hours, and the funds are in your account within 24 to 48 hours after approval.

These are an option if your personal credit isn’t terrible and you need funds fast.

Demolish your financing problems with 27 killer ways to get cash for your business.

Crowdfunding

Crowdfunding is a newer option for finding investors. It is not always possible to find one or two large investors. With crowdfunding, you can literally have multiple investors fund your business $5 and $10 at the time.

There are many crowdfunding sites, but the most popular are Kickstarter and Indiegogo. The platforms are similar but there are some important differences. The most obvious is when they release the funds raised..

Kickstarter requires you to set a goal, and you do not receive your funds until that goal is reached. 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, but they offer the option to receive funds as you go if you want. They also have something called InDemand. This program allows you to continue raising funds after your original campaign is over without starting a whole new campaign. It is more of an extension of the first one.

There are other crowdfunding sites also. These are not the only two. Different ones work better for certain businesses and vendors. To figure out which one you might have the most luck with, you will have to research. Keep in mind your type of business and the specific business each one appeals too.

Grants

Generally, these 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.

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

Women owned business

Minority owned business

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 anything really other than that you meet the corporation’s definition of a small business and win the contest.

Business Credit Cards

These get a bad rap. However, if there isn’t another option, they can actually work well. The draw is that they are available much more readily even with a credit score that isn’t great. To be fair, the lower the credit score, the higher the interest rate. Also, there are limits on how low they will go with a credit score.

Still, most of the general public is eligible for this type of financing. They do a credit check, but your credit doesn’t have to be as high as it would be to get approval for a traditional loan.

The downside of business credit cards is that they typically have a high interest rate. The upside is that many of them offer rewards in the form of cash or points.

Best Funding at Each Stage

Which type of funds will work best for you depends on a lot of factors. The main two include which types you qualify for and what phase your business is in. Assuming you are eligible for all types of financing, here is what to consider at each stage.

Startup Phase

In the startup phase, there are a couple of things to think about when determining which business capital type might work best for you.

If you fall into one of those categories that make grants an option, that is the best first stop. Grants are free and clear. That money is yours, without repayment, to use in your business. They usually do not rely on the success of the business or the credit worthiness of the owner. The business or proposed business only has to meet the requirements set forth to apply, and then win the grant.

Crowdfunding is also a viable option here, but there has to be a backup plan in case the goal isn’t met.

Traditional term loans are a good idea for the startup phase also, if you qualify. The interest rates and terms are more favorable than other types of financing for those that meet the credit requirements.

If you do not meet the credit requirements for traditional term loans, then non-traditional lenders are the next best option. They may have higher interest rates, but they get the job done. Plus, they can help build your business credit score if you make your payments on time.

While not impossible, it is not usually a good idea to start a business using credit cards if you can help it. Of course, invoice factoring is not an option because you have to already be in business to have the invoices necessary.

Demolish your financing problems with 27 killer ways to get cash for your business.

Growth Phase

There are several aspects of growth that can benefit from different funding options.

Increase Inventory

If you see the growing demand and need to increase inventory, a revolving credit line is going to work best.

If already in place, these are available as needed to accomodate a large inventory purchase. They also allow for taking advantage of special pricing when possible.

A business line of credit works well due to the lower interest rate, business credit cards will work in this situation also. In fact, if they have really great rewards attached to them, they could even be the better choice. It can’t hurt to have both available if you can so that you have options.

If available, grants work well for growth projects as well.

Equipment

For large equipment, it is best to use traditional term loans if available. This is because they are typically longer term loans for larger amounts. Lower interest rates and favorable repayment terms are key. We all know, however, this isn’t always possible. In a pinch, other types can work for this.

Grants may be an option if there is not a time crunch. If time is of the essence, it is possible to purchase equipment on credit cards, but you could run into problems with cost versus credit limit.

Expansion

If you want to add on to your current building or add another location, term loan financing is the best option. Whether it needs to come from a traditional or non-traditional lender will depend on your specific situation.

Working Capital

Working capital is the cash you have available to run your business. Everything from payroll to repairs, maintenance, seasonal cash gaps, and emergencies are all things working capital covers.

It can come from various funding types. There are working capital loans available, but lines of credit and business credit cards can work in these situations too. Unless you already have a working capital loan before it is needed, you will likely have to access business credit cards or some form of non-traditional financing for this.

In a pinch to cover a cash gap, a merchant cash advance or invoice factoring can work well.

Your Ability to Get Funding is Directly Affected by Your Fundability

The main factor in whether or not you can get funding for your business is fundability. The fundability of your business includes many things. It has to do with how your business is set up, both personal and business credit, and even things you would never think about like parking tickets and outstanding liens. The most controllable part of course, is business credit. If you work hard to keep that strong, it is possible to get the cash you need.

The post How to Get Funding for Your Business appeared first on Credit Suite.