The bad news is that it is incredibly difficult to obtain bank loans for small businesses. The good news is that there are alternative funding options now easily available.
If you are a small business owner desiring to secure funding, look for different options to find your best fit. Your business need not suffer simply because a bank denied you a loan.
Any lending that is different than loans via traditional means is termed as alternative funding. Some examples of alternative funding are financing via lending companies, crowdsourcing, marketplace lending, etc. Find your best fit and you are all set to secure financing for your small business.
Consider these tips for alternate small business funding.
Find the right fit.
Not every alternate funding source will be right for your business. So, you need to find the best possible financing option for your business.
Crowdsourcing isn’t ideal for most businesses. Not everyone is comfortable with it as well. Your business may not be eligible for a government grant. Fintech companies advertise simplified loans but their charges may be higher or the process is actually not so simple. You may invite an investors onboard to get the necessary financing. But that also means reducing your own share in the business; even if the investors are your friends or family. There are financing companies where their business is to provide loans to small businesses. It may or may not work for you; depending on their terms.
To simplify your search, use location-based searches; such as small business loans Charlotte NC. Using such keywords for online searches will provide you with some good leads.
Go through the search results and check the websites of different alternative lenders. Look for information that will help you narrow down your search.
- Is the lender supportive of small businesses? Small businesses have a hard time securing financing to survive. If they want to expand their business, they will still have a hard time finding a supportive lender.
- Do they require prior credit history? If you don’t have five years’ or so worth of credit history; it shouldn’t stop you from following your dreams.
- Do they offer loans for your specific requirement? For instance, if you need funding for used equipment, does the lender you like offer it? If your business is less than two years old, is the lender willing to offer you the funding. Not all lenders are supportive of new businesses. So, clearly check if the lender will fund your specific business requirement.
Check information on the lenders’ websites to find all relevant details and decide accordingly. Location-based searches; such as small business loans in Charlotte NC can be of immense help in this regard.
Find the best deals.
Merely finding the right lender is not enough. You also need to find the best deals available for your business. For instance, if you are looking for equipment financing for your small business, you need a lender offering you the best possible solution. Perhaps you can get a better deal on used equipment rather than new ones. Perhaps the lender can help you find the right equipment from its vendors’ network. Some lenders can even provide funding for equipment sold via or at auctions.
Many lenders support their local businesses. Some offer special deals for veterans or via loyalty programs.
So, check their websites and shop around for the perfect business financing deal.
Initiate contact.
Once you recognize a few good deals, it is time for the next step. Contact the lenders you shortlisted with your requirement. Use the application process or contact method they recommend on their websites. This will likely ensure a speedy response.
Any lender that doesn’t respond within a day or two isn’t likely right for you. If you have any queries or concerns, do not hesitate to get clarity on them. The approval process shouldn’t belong too. A good lender will process your application within 24 hours or less.
If you don’t like anything during the process, feel free to back out of the deal. A good lender will never take advantage of your situation. Try to get a good deal via a good and trustworthy lender.
With these tips, you are sure to secure alternative small business funding.
Leave a Reply