Did you know that in recent reports over 63% of business owners seeking out loans first targeted banks for their lending needs? Out of this 63% only a low 27% of the applicants actually got approved for the loans. A lot of the business owners were turned down due to the fact that they had bad credit. With the recent downturn of the economy, times have been tough for many businesses, small and large. Unfortunately, once you have bad credit it follows you around like a plague for years and years. So, what do you do if you have bad credit and need to expand, open up another branch, or want to introduce a new product on the market, but need a business loan to do so?
Seek Out Assistance from Outside Sources
Most people want to be a business owner or an entrepreneur at some point in his or her life. This is why most business owners in need of money turn to relatives and friends for assistance. Your friends and family want to see you succeed and are probably more than willing to do whatever it takes to give you the assistance that you need to achieve your goals. Most loyal friends and family won’t hold bad credit over your head like banks do because they may know that you are going through a rough patch and just need a little help to get back on track. In addition to this, your friends and family probably won’t ask for collateral like most lenders.
Consider Web-Based Lenders
You would be surprised to learn about all the financing opportunities that are available online through nonbank lenders. Just simply check this list and you will discover a variety of different lenders that are offering microloans to entrepreneurs with bad credit. These loans are usually anywhere from the ballpark of $5,000 to $25,000, but when you start repaying the loan the lender will report the activity to credit bureaus, which can eventually help you rebuild your credit.
Never Forget About Grants
Did you know that the government gives away grants every year to certain business owners? Of course, you may have to meet certain criteria. You may need to be located in a low-income area or you may need to be a healthcare business, but this is pretty much free money that you won’t have to pay back. You will have to put in some time and research in order to find a program that suits your needs, but there could potentially be one out there for you.
Consider Seeking a Partner
Everyone wants to own their own business and be their own boss, but there are times when you might have to compromise. If you have bad credit and just can’t get a loan at a reasonable rate, you always have the option of seeking out a business partner that has solid finances. You might end up having to share a portion of your business, but you will secure the funding that you need to open your business or expand.
