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Getting business funding with a bankruptcy

So, now you have a bankruptcy to worry about. It’s destroyed your credit and ended your dreams….. maybe. What has happened, is that you learned some lessons, and you figured out how not to do things. Now, you can start again with something new and try to start on a different path.


It’s a tough road to walk down when trying to get your credit all cleared up. There are some great suggestions on the internet, but remember to walk on the side of truth.

The banks have pretty much slammed their doors on anyone that doesn’t have good credit and forget it if you have a bankruptcy. Don’t give up though. This will be a time to get creative and it may mean a little more work on your part. But, if the business venture is really worth your time and investment, then by all means, do the work and find the capital to get started.

Home investment

A home equity line of credit may be the only way to get this ball rolling. Look into how much equity you have on your home and see if someone would use it to help get the ball rolling. Being creative, may mean putting everything on the table.

A line of credit would also mean that you could have extra capital at your fingertips if something goes wrong. Pay this off often and don’t let it sit there long. You don’t want to have a constant extra loan on your home. After the major crash we had with housing market, be cautious and protective.

Small chances

Credit cards come with a high interest rate, but with the right balance, you could indeed start your business with it. Pay it off often, preferably by the end of each month, and it not only raises your credit, but you won’t have to pay late fees and those high rates. If this is your dream, then this is an option.

Family and friends

This avenue is difficult on everyone, especially since the bankruptcy is fresh on the minds of family and friends. Have your business plan ready and don’t be afraid to show them. Walk them through the whole scenario and bring the dream alive for them. If this step works then you are on your way again.

Angel Network

This is a group of investors that help businesses raise capital for their start up’s. They ask for at least a convertible debt or ownership equity in exchange for their help and investment. They are very good at pointing people in the right direction to get help. Some will be individuals and others have organized themselves into groups. Ask local banks, credit unions, or do an internet, search where to find a group near you.

Not the end of the road

A bankruptcy is not the end of the road. It may very well be the beginning of something beautiful. You are smarter and wiser than you were when you had to take out the bankruptcy, so now, take that knowledge and the options and grow a wonderful business.