Are you in need of funding for your business? What’s the biggest obstacle on your way? Is it the lack of collateral? How can you obtain business loans without collateral? This article will give answers to your questions.
Business Loans Without Collateral
The absence of collateral is one of the biggest obstacles standing between small business owners and lenders. If this is your case, you’d better look for a funding provider that won’t require collateral to get you the necessary funds.
The majority of small business loans require borrowers to provide personal collateral. As a result, they get a peace of mind in case the borrower fails to pay back the loan. Well, what if you don’t have any collateral to provide?
Of course, you’ll find many alternative lenders requiring a personal guarantee of cash flow, but not collateral. For example, they may require you to personally guarantee that you’ll pay back your loan, but they won’t require you to provide any real estate or personal collateral.
By the way, there exist 2 types of loans: secured and unsecured. The former has collateral that guarantees them. The latter is available even for those who lack collateral.
To easily obtain a business loan without collateral, look no further. Just get down to finding a reputable alternative online lender. Let’s take First American Merchant. FirstAmericanMerchant.com is an award-winning alternative online lender and payment processor that’s ready to work with merchants of any type and size. With FAM, you can be sure to get business loans without collateral fast and easily. The rates are the lowest possible in the industry.
Getting a Business Loan Without Collateral
Now, let’s see what options you have when searching for business loans without collateral:
- Merchant Cash Advance (MCA)
MCAs have turned into an amazingly popular type of business funding in recent years. They’re ideal for merchants searching for quick access to working capital. Even though the rates may be higher, however, an MCA is worth that.
You borrow an agreed-upon sum and pay back the amount via a fixed percentage of your credit card sales. Did you know First American Merchant is popular for offering exceptional terms for a merchant cash advance?
- Term Loan
This is a lump sum, which you can borrow and pay back within about 4 -5 years. This period is based on set terms like the annual percentage rate.
- Line of Credit (LOC)
This is a set amount of cash you get access to and tap when necessary. Businesses in need of short-term financing to bridge cash-flow gaps apply for this type of financing more often.
- Invoice Factoring (Invoice Financing or Accounts Receivable Financing)
This type of business funding is good for small businesses dealing with unpaid invoices. You won’t have to wait to be paid. You can just get an advance on those invoices, which you’ll then repay along with a fee when your customers settle their accounts.
- Private Equity Investing
Thanks to private equity investing, business owners get access to ample funding. You’ll need to have a strong business proposal to investors that’ll convince them to purchase shares of your company.
Well, many business owners need access to working capital, but they don’t have collateral that’s a necessity in many cases. Lenders who aren’t willing to provide loans without collateral make many entrepreneurs be unable to solve several important problems with their businesses.
That’s where alternative online lenders step in. Alternative online funding options make the highest chance of success a reality for you. So, if accessing reliable funding is imperative to you, just find a true professional in the field that can help you thrive and move forward.