3 Advantages of Using Alternative Lending
When you own or are starting a business, finding the right financing solutions can make or break your plans for growth. With alternative lending solutions, you can find the money you need with three main advantages such as quick approval and approval despite impaired or bad credit. These lending sources an include merchant cash advances and business lines of credit which are not through traditional lenders such as banks.
Quick Approval Processes
Taking out a traditional bank loan can have its own benefits, but the approval process is slow and can take months to even get a negative answer. This is because collateral needs to be appraised at an amount which all parties agree to, underwriters need to be consulted and much more. Most forms of alternative financing have a quick online application process and approval times of less than a week. This can help you streamline your funding searches and get your cash flow back on track sooner.
Unsecured Business Funding Solutions
With alternative lending solutions, you can find many options that are unsecured. Bank loans are secured with either business or personal assets which can be seized and sold if the loan is defaulted on. Unsecured solutions can include merchant cash advances, unsecured business loans and even business lines of credit. Having unsecured funding solutions can help you get the financing you need without having to put up your assets, if you have any which qualify, as collateral.
Impaired or Bad Credit Approvals
Your business credit score and history are separate from your personal one and is based on a different rubric. You will even have different credit bureaus for business and personal credit. This can be helpful in that if your company has trouble making payments, it may not impact your personal credit score. However, it can be detrimental to your company because it can take longer to establish a business credit history, making it harder to get the funding you need for a start-up. With alternative financing sources, you can find lenders who look at more than just the credit score and into the investment potential of your company and business plan.
Alternative lending solutions can help you get the cash flow that you need for working capital as well as funding for large projects. There are many advantages to this lending type including a quick approval process and approval for bad or impaired credit. You can also find many alternative funding solutions that are unsecured, meaning that you do not have to put up collateral for the financing.