You may have done extensive research on small business loan bad credit situations and options. You may have found that there are a few options out there for you, but there are two options that we recommend to our clients regularly and strongly suggest. They are both lucrative ways to get the capital you need for your small business, and neither one requires a 650 FICO score as a criteria.

Business Cash Advances

  • Business Cash Advances are an alternative to small business loans. The amount of the advance is based on your estimated future credit card transactions. It’s an unsecured loan that provides capital to help your businesses daily operations or expansions.
  • Past credit card receipts are assessed to determine how much you are expected to swipe in the future. Based on this amount, you are provided with the cash in advance. The loan is repaid out of the upcoming credit card payments. Some companies provide cash up to $250,000.
  • This is an informal way of obtaining working capital. There are fewer restrictions and requirements than with formal small business lenders. They do not require good credit, collateral or a long business history. Everything is based on your future credit card sales.
  • Private lenders are always available to invest in small businesses that they believe can get them a great return on their investments. They have extra cash they want to invest, rather than letting it sit in a bank.
  • Their main concern is the amount they will profit from backing your business. That is why they are not as concerned with your credit score as traditional small business lenders. They actually get to read your story, learn about who you are, what you do and what you are capable of.
  • The deal, or contract, is made between you and the private lender themselves. There are no middle-men or corporate structures to answer to. You are usually given the freedom to continue to run your small business the way you like, as long as the lender sees profits rising.

Private Lender Loans

SBA Private Lenders

The Small Business Administration offers loan programs run by private-sector small business lenders. SBA does not provide loans or grants at this time. They simply guarantee your loans with small business loan bad credit lenders. Here are the main loan programs available:

  • 7(a) Loan Guaranty Program
    • Loans provided up to $2,000,000.
  • Certified Development Company (CDC)
    • Long term, fixed-rate loans.
    • Used to purchase real estate or equipment for business expansion or upgrades.
  • Microloan Program
    • Loans provided up to $35,000.
    • For eligible start-up companies with business growth concerns.
    • Organized by local non-profit lenders.
    • All lending is done on a local basis.

Small business loan bad credit situations do not have to be the end of your business in times of financial need. Alternatives to the traditional small business loans with banks do exist. If your credit score is below 600, you will be probably be denied the loan anyway. The two alternatives above are easier and less stressful ways for you to get the cash you need.