Small Business Loan for business owners with bad credit is a very Hot Topic for people that have bruised credit for a variety of reasons but need funding to grow their business with the hopes that building up their business will be able to afford them to fix any credit issues that have popped up.
To start why, why do Small Business owners business owners get bad credit?
The most likely reason for business owner’s to get bad credit is often caused by cash flow troubles, which is generally caused by the business owner putting everything in to their business to bridge the gap between the time they need to pay for their raw materials and wages and then wait for payment from the customer. Many company owners will pour their soul into their company to grow the business. And then celebrate increased sales and dream about the future with all the growth they are experiencing due to all their hard work and sacrifices they happily do for their company so that they can be a financially successful business owner.
Then it hits them…all these sales need raw materials and their staff wants to get paid every week. But it takes weeks or months to receive payment from their customers for all the goods that are sold. They need to pay suppliers for the goods in their inventory, and then pay the wages. Not to mention the government remittances that need to be made – and do not forget about the rent, electricity and other utilities that need to be paid at the end of the month. A business owner will pay these costs at their own expense. They do this by using personal savings, taking advances on credit cards. And worse yet, by borrowing money from family that will lend to them. All this to cover the time span that it takes to receive payment from their customers.
The biggest reason business owners’ get bad credit is not due to overspending or mismanaging their money.
So if you had a business that was being cash strapped because all your money is tied up in your inventory and accounts receivables, what would you do? Would you use your personal savings, credit cards and ask family and friends for personal loans? If you say “NO”, you are not likely being honest with yourself, most people would. But what happens when that dries up? Now, you will be looking for Small Business Loan for business owners with bad credit. Something you never would have expected, but it happened.
What are the options?
When it comes to Small Business Loan for business owners with bad credit the options are not available at a bank. But they are available at IMM. You have options which include the following:
Commercial Credit Lines based on Accounts Receivables (factoring): This is a line of credit for your business where your delivered goods sold to other businesses on credit. This can create a base where you can have funds available to your company to pay your business related expenses.
Asset Based Lending or ABL: This is also a credit line that is based on accounts receivable but also takes into consideration inventory and possibly other assets the company has to create a borrowing base. These funds can also be made available to your business to pay bills for your
Small Business Loans: There are options to get a business loan, similar to factoring where total receipts your company has received as a borrowing base. The loan can be equal to an entire month’s sales, even if you have less than perfect credit.
How to know which is the Best Fit?
To start, we will need to discuss with you what your needs are. Then we can see which program we have is the Best Fit for your business. Often, we can tailor a Small Business Funding Facility that will fit the needs of your business. This can be done by combining different programs to make a custom facility, just for your business. This usually involves taking more that one of our programs and putting it together with other of our programs. This way we can create a facility that will work for your company today and for years to come.
You can chat with us, send us a message or give us a call – whatever works best for you!
IMM Small Business Loan For Business Owners With Bad Credit.