It’s difficult to secure a loan if you have a bad Credit score, but it is not impossible. Businesses with bad credit scores can get a merchant cash advance and here’s why:
Getting business capital can be extremely challenging. It might not be so difficult if you know where to look. If you are a small business, getting funding from banks is the least of your options. One of the quickest and easiest ways to obtain financing for your small business with bad credit is a merchant cash advance. Companies like WeCompete Lenders have almost 100% approval rates on merchant cash advance for businesses with bad credits.
A less than perfect credit does not mean business has gone awry. However, it reflects poorly on the company. Good credit can turn bad in a day. Business can suddenly turn sour due to bad publicity or customers that fail to make payments on time. Sometimes it stems from circumstances that are beyond our control. What you should remember as a business owner is getting back on your feet as soon as possible. You might fall behind of your competitors if you do not seek a way out of the jumble.
The Basics of Credit
We’ve been talking about bad credits for a while, but what exactly is credit? How can you differentiate the good from the bad? As a business owner, you must keep your eyes on the status of your credit. Keeping track of it should be a priority.
Your ability to borrow and the extent of the loan you want to avail is referred to as the credit. It is your reputation as a borrower. Lenders use credit as a measure of your “worthiness” for a loan. Credit takes into account your credit history and mirrors your attitude towards managing your debts.
Everything lenders should know about your credit can be seen in a master document called a credit report. It contains information such as:
All your previous loan transactionsAll your present loansThe amount you borrowedTotal payments you post monthlyYour payment historyRecords of bankruptcy and loan forfeiture
Whether you get a loan or not will depend on the information on your credit report. Aside from a credit report, lenders also rely on your credit score. It is difficult for lenders to review all documents pertaining to your credit history. With a credit score, one look is all it will take to reach a decision.
A credit score is a number generated by a computer program that analyzes information from your credit reports. Lenders set standards for loan applications using a credit score. For example, a lender would require a minimum credit score of 680 for a small business loan. Businesses with credit scores lower than 680 can still avail of the loan, only at a slightly higher interest rate. Credit scores help boost the alternative lending industry by making it easier for lenders to grant or reject a loan. They make pre-approval and immediate approval of loans possible.
Are there loan options for businesses with bad credit score?
A bad credit score makes it impossible to get a traditional business loan. Fortunately, higher risk small business lenders, such as WeCompete Lenders, can provide loans for businesses with bad credit scores. There are several alternative funding options you can avail regardless of your unpleasant credit history. Most of those options, however, require collateral. Another alternative would be a merchant cash advance.
As discussed in our previous article,Merchant Cash Advance: The Better Alternative, a merchant cash advance is, technically, not a loan. Rather, it is an advance made on the future credit card revenues of the company. This is a quick and easy alternative funding option readily available for businesses that are in need of immediate funding. The best part with all of these is, you can get access to them even with unattractive credit records.
How do I get a merchant cash advance if I have a bad credit score?
We will not be going through the process of how to avail of a merchant cash advance because at WeCompete Lenders it is as easy as 1-2-3. We are going to provide an answer to the question, “How is it possible to avail of a merchant cash advance if you have bad credit score?”
We have established that credit scores are the basis for most loans, but a merchant cash advance is not a loan. Taking payment as a percentage of the future credit card revenues of the company ensures lenders that the debt will be paid off.
Roxanne Samar, our Key Account Representative, noticed that the common factors among the bulk of our clients are not good credit scores.
“If bad credit scores cut off access to funding, then half of our current clients shouldn’t be receiving our services. Overlooking bad credit scores is not something we do. We just find a way around them by focusing more of our attention on their potential rather than their history”she said.
Most of the clients who availed of our financing options were turned down by banks and other alternative funding institutions due to their credit score. At WeCompete Lenders, we evaluate your loan application by conducting a thorough investigation of your credit score. This investigation will highlight the strength of your business. To be more specific, it will center on your gross sales. A bad credit score can be offset by a steady stream of credit card sales monthly.
Businesses who do not meet our requirements are still presented with financing options from our experts. Here, we believe that bad credit scores come from several things, some of it beyond your control; which is why we are not scrapping your application. Business owners do all that they can for their businesses, the very reason they come across debt and unpleasant credit scores.
Aside from higher chances of approval, our payment rates are also definitely lower compared to other financing institutions. We do not bag on credit scores alone so we can provide finances for businesses that need it the most. Making funding accessible to small business owners is what we do to achieve our goal of making interest rates more competitive in the financing industry.
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WeCompete Lendersis the premier lending company in the alternative lending industry. Our company has a network of over a hundred lenders who share the same objective of empowering merchants. Avail of our merchant cash advance at rates lower than others in the market. You can talk to our experts at (844) 516 0633 or [email protected]
