Finding a bad credit business loan may seem like an impossibility as a business owner, given the limited credit environment which we currently find ourselves in. The best choice for any business owner is always going to be a loan backed by the Small Business Administration and is funded through the SBA approved by the Bank.
The reason for this is that these loans typically have the most favorable interest rates and terms. However, most business owners will not be eligible for this type of loan for underwriting requirements limit. You can browse https://www.buc.org/small-business-loan/ to know about bad credit business loans.
Here are three options for business owners that need to consider if they wish to obtain working capital in the current environment, especially if your business or personal credit has taken some hits because of the recession.
1.) If You Own Commercial Real Estate – If you have a building or property that is your business and you have a good amount of equity, you may have a real choice here that is relatively affordable. The main thing to look at is how much you believe the property may be worth it, how much you owe on it, and how much are you looking for in a loan.
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The advantage with this option is that even with bad credit, the rate is likely to be the best of each option as you secure a loan with real estate. Most lenders of commercial property will go to 70% of the appraised value of the property, minus the amount you owe as the loan amount.
2.) If you have plenty of Equipment – Businesses are intensive equipment such as restaurants, construction companies, etc. may have the option of secured equipment loan. This is a loan, usually within 3, 5, 7 or 10-year term with a balloon payment that is secured to the assessed value of the equipment that your business has to operate.
3.) If you’re Business Accept Credit Cards – This option, known as a merchant cash advance, is the fastest of the three, which means that these loans can put money in your hands in a matter of days or weeks. This loan, technically called “progress” usually comes from a credit card processing company or a merchant cash advance company.