bad credit business loans

What type ABL Business Loans are available for small businesses with bad credit and or are not bankable? How does an Entrepreneur make the best choice for their start-up loan or newer business? First, let’s look at the variables involved in your unique situation and give you a checklist to use:

Startup Business Questions

  • Are you starting a Retail or B2B/B2G Business?
  • How much money do you need?
  • Do you have any money to put down?
  • How is your personal credit?
  • Do You have any Direct Industry Experience?
  • How soon do you project to be cash flow positive?
  • Will your business be an importer or exporter?

Here are Answers for each financing questions one by one:

What type of business are you starting?

If you are buying and reselling goods, Invoice Factoring or PO-Purchase Order Funding (PO Funding) is available for start-ups. Also, if you are starting a service business supplying temp staffing, guard service, trucking or IT services, for example, an Invoice Factoring Company can supply pre-client credit approval and be ready to fund the minute you generate an invoice.

What if you are starting a Retail or Restaurant business?

There are SBA-backed programs available including the 7a, Micro Loan Program, and Express Program. Also, there are business loans based on your credit cards receipts available after you have been in business at least six months called Merchant Cash Advance. There are also programs to get you $50,000-10,000,000 in financing for equipment or other needed hard assets to get you started.

Are you already buried in multiple merchant cash advances? The merchant cash advance consolidation program can help. Please call us for more information.

How Much Money Do You Need?

Different Lenders and Funding sources have different “sweet spots.” For instance, programs for Invoice Factoring of $30,000-$10,000,000 per month. Larger secured business financing programs are available. The Merchant Cash Advance program can help businesses needing $30,000-$10,000,000. Startup loan, capital loan, microloan, business funding, business financing; factors have their own programs and reciprocal relationships with the alternative lender community to meet almost any small business credit need.

How Much Money Do You have to Put Down?

This question is significant if you are going to the traditional bank route or SBA-backed loan. Banks typically don’t make zero down business loans. However, an Invoice Factoring Company cares more about the creditworthiness of your clients, and factors will advance you up to 92% of your invoiced amount. You will receive the remaining balance once your customer has paid minus low cost fees.

Do You have Direct Industry Experience?

This question is ultra-critical to traditional banks and to SBA-backed lenders (unless you are buying a solid franchise). It is not important to an Invoice Factor, and it is somewhat important to a Purchase Order Financing or Inventory Financing Company as they want to know you have the expertise to help liquidate the goods funded if needed.

Under SBA rules, factors are considered a Lender Service Provider. This is a much more extensive role than a “Packager,” whose job is to take an already structured and an approved loan and prepare the paperwork for submission to the government. While SBA packagers perform a valuable function in the process, they do not provide a comprehensive range of services that we do.

How soon do you plan on being Cash Flow Positive?

Again, this question is ultra-critical to traditional banks and to SBA-backed lenders. They both will require a business plan with cash flow projections. Again this is not as important to an Invoice Factoring Company, but an analysis of your profit for each deal is important to an Inventory Finance Company or PO Funder as they can only fund a deal where your profits are sufficient.

Will your business be an Importer or Exporter?

The SBA has some interesting programs for export companies. If you are an Exporter, has International Factoring Experience and can help. If you are an Importer, we have deep Factoring and PO Funding experience in almost every consumer good imaginable.

Is bad credit scaring your bank? We understand your needs. Call (888) 400-5930 or use the fast, safe & secure online funding application.

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