It’s no small task to turn your business idea into a reality. If you’re struggling with a less than stellar credit history (or no credit history), your business venture can come to a screeching halt before it even has a chance to get off the ground. The same is true for the established business. Traditional lenders simply won’t work with you. A bank categorizes a business with bad credit as being “high risk”, making it incredibly difficult for you to secure a traditional bank loan.
If you find yourself in this position, it’s time to turn to an alternative lender like First American Merchant. Approval with alternative lenders is typically based on business performance not financials or personal credit. Where traditional lenders are hesitant to give you the cash you need, a high-risk provider specializes in working with businesses otherwise considered to be high risk. Their services are tailored to meet the needs and challenges of each business type and industry it works with – including those with little or poor credit.
The biggest advantage of working with a high-risk provider is that the process is known for being simple and straightforward. Applying for a traditional business loan involves endless documentation requirements and long wait periods. A high-risk business loan, on the other hand, can be setup quickly and provide you with the capital you need in as little as 72 hours – if not sooner. The simplicity of the high-risk business loan process combined with the willingness to work with bad credit merchants have made alternative lenders an increasingly popular choice.
What business types benefit from high risk business loans?
- Cash-intensive ventures (convenience stores, retail outlets, restaurants, etc.) are among the list of business that have a hard time securing loans from banks and other traditional lenders.
- Professional corporations (lawyers, accountants, dentists, etc.) are also deemed high-risk by banks.
- Startups probably struggle the most to secure the business funding, since they have a relatively short credit history.
- Established businesses that experience unpredictable cycles or seasonal fluctuations are also labeled as high-risk.
It’s true that recovering from bad credit will take time. Fortunately, working with an alternative lender can help you rebuild your credit score. Your business can secure the funds necessary to hire new employees, increase inventory, purchase or upgrade equipment and boost its marketing efforts.