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Ways Bad Credit Effects Small Businesses | Merchant Cash Advance

Is your business struggling with bad credit? There are many ways bad credit can affect your business and your personal life. Find out the top ways bad credit can hurt your plans, and where to find quick access to funds to boost working capital.

How Bad Credit Can Hurt You Personally

  • Higher down payments – When you need to borrow money for a car or house, for example, it will more than likely require a down payment. If you suffer from bad credit, the required down payment will probably be higher (the bank will view you as a high credit risk).
  • No access to money – When certain life situations happen, like unexpected medical emergencies, seeking help to cover costs is sometimes necessary. Bad credit considerably reduces your access to money, making you more vulnerable during those emergencies.
  • Risk of job loss – Today, many employers choose to check out their employee’s credit reports. In highly competitive jobs, there is a concern that negative information on a credit report could lead to employee theft. As a result, you might lose a promotion, a raise, or even your job.
  • Failed relationships – It goes without saying that debt can cause a lot of strain on relationships. If you borrow money from family members or friends, this can quickly turn into an awkward situation – or worst case – end relationships.
  • Lack of life improvement – When bad credit is present, mobility becomes a huge issue. Your ability to make life improvements like buying a car or going back to school so you can get a job are seriously restricted. Bad credit can make improvements in life incredibly difficult, if not impossible.

Ways Bad Credit Negatively Effects Your Business Plans

  • Inability to obtain a business loan – The same as personal loans, bad credit prevents business owners from securing the cash they need. Business credit is one of the first things a lender will take a look at when determining your eligibility for a loan.
  • Issues created with vendors – Another issue many business owners don’t think about is the problems bad credit causes with vendors. Your credit score could affect your ability to conduct operations and order needed supplies.
  • Inability to start your business venture – If your credit score is really bad, it could prevent you from starting your business at all. Loans to cover basic start-up costs (e.g. equipment, office space, staff, inventory, etc.) will simply be out of reach. Banks will turn you away, leaving you with no working capital to get your business off the ground.

Where to Find a Loan with Bad Credit

Thankfully, alternative lenders like First American Merchant have years of experience in offering cash solutions to those struggling with credit issues, like a merchant cash advance bad credit. What is a merchant cash advance? A merchant cash advance involves the provider purchasing your future sales at a discount, in exchange for a cash advance (both parties agree to the amount of sales being purchased and for what discounted cost).

Here are the top 5 benefits of a merchant cash advance from First American Merchant:

  1. High Approval Rate: A merchant cash advance approval is based on business performance rather than personal credit, time in business or financials.
  2. Fast Funding & Easy Renewals: You can have money in your bank in as little as 72 hours.
  3. Simple “No Hassle” Payback: There is no need to write a check every month, your payments are automatically held from your credit card transactions (no mixed monthly payments).
  4. Revenue Based Collections: Payment is a percentage of your daily sales, so if you have a slow month you are paying back less, if you have a good month, you are paying back more.
  5. No Credit or Collateral on the Line: Unlike a commercial business loan, a merchant cash advance is actually a sales transaction, so they are not reported on credit reports.

Don’t let bad credit stop you from proceeding with life and business plans. Take advantage of the speed and flexibility of a merchant cash advance today.