Small Business Loan Sources
by Lisa Phillips
Page 2 of 2
by Lisa Phillips
Page 2 of 2
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Business Opportunities
Home-based business opportunities.
Earn extra income from your
computer.
Bad Credit Business Loans
Find alternative funding sources if
you have bad credit.
Micro Business Loans
Do you need just a little cash to grow
your business try a microloan from
the SBA.
Business Loan Sources
A little creativity and al lot of
determination can get you the money
you need.
Home-based business opportunities.
Earn extra income from your
computer.
Bad Credit Business Loans
Find alternative funding sources if
you have bad credit.
Micro Business Loans
Do you need just a little cash to grow
your business try a microloan from
the SBA.
Business Loan Sources
A little creativity and al lot of
determination can get you the money
you need.
Friends and Family
Not surprisingly, more than 50% of all start-up costs for new entrepreneurs come from
friends and family. Friends and family desire to see loved ones succeed and follow their
dreams. If your credit is weak you are more likely to get a short-term loan from a friend
or family member because they evaluate your character, not your credit scores. This form
of lending has so evolved that there is now a website which will help you facilitate a loan
between friends and family. www.virginmoneyus.com
Borrow money from the Bank or Credit Union
If you are trying to borrow $50,000 then the bank would like to see you that you have
invested $15,000 of your own funds into your venture. I was recently approached by a
new business start-up seeking capital. The idea was unique and potentially very
profitable. The business and marketing plans were excellent. However, when I asked the
business owner how much of their own money they had invested in the business, to my
surprise, the answer was zero.
The business owner stated they did not want to tie up their own money in the business.
Well, as a potential investor, I am not willing to invest in an idea that the business owner
is unwilling to invest in. Banks and lenders are the same way. If you don’t fully believe in
the profitability of your idea and put your own money behind it, no one else will. If you
are going to approach a bank be prepared to submit a good solid business plan along
with your some of your own money to invest in the business.
There are some banks that only require financial information and the process is much
quicker. Be prepared to have a good credit score when using this low documentation
method.
Commercial Finance Companies
Commercial Finance Companies finance equipment and inventory purchases. Small
businesses involved in manufacturing and wholesaling can benefit from commercial
finance companies because of their collateral. Start-up businesses usually cannot qualify
for these types of loans because commercial finance loans tend to be highly collateralized.
These loans can be more expensive than a traditional bank business loan. For
established business these loans can be a good alternative to traditional banks as their
credit criteria is less stringent and commercial finance companies are willing to take on
riskier loans. The assets used to secure the loan must be immediately accessible and
marketable.
Page: 1 2 Back
Not surprisingly, more than 50% of all start-up costs for new entrepreneurs come from
friends and family. Friends and family desire to see loved ones succeed and follow their
dreams. If your credit is weak you are more likely to get a short-term loan from a friend
or family member because they evaluate your character, not your credit scores. This form
of lending has so evolved that there is now a website which will help you facilitate a loan
between friends and family. www.virginmoneyus.com
Borrow money from the Bank or Credit Union
If you are trying to borrow $50,000 then the bank would like to see you that you have
invested $15,000 of your own funds into your venture. I was recently approached by a
new business start-up seeking capital. The idea was unique and potentially very
profitable. The business and marketing plans were excellent. However, when I asked the
business owner how much of their own money they had invested in the business, to my
surprise, the answer was zero.
The business owner stated they did not want to tie up their own money in the business.
Well, as a potential investor, I am not willing to invest in an idea that the business owner
is unwilling to invest in. Banks and lenders are the same way. If you don’t fully believe in
the profitability of your idea and put your own money behind it, no one else will. If you
are going to approach a bank be prepared to submit a good solid business plan along
with your some of your own money to invest in the business.
There are some banks that only require financial information and the process is much
quicker. Be prepared to have a good credit score when using this low documentation
method.
Commercial Finance Companies
Commercial Finance Companies finance equipment and inventory purchases. Small
businesses involved in manufacturing and wholesaling can benefit from commercial
finance companies because of their collateral. Start-up businesses usually cannot qualify
for these types of loans because commercial finance loans tend to be highly collateralized.
These loans can be more expensive than a traditional bank business loan. For
established business these loans can be a good alternative to traditional banks as their
credit criteria is less stringent and commercial finance companies are willing to take on
riskier loans. The assets used to secure the loan must be immediately accessible and
marketable.
Page: 1 2 Back
Related Topics:
Social Lending
Peer to peer lending is not a new concept but the Internet has made it easier. This type
of lending matches borrowers directly with lenders, circumventing banks and other
middle-men. Peer to peer lending is a great alternative to traditional banks’ stringent
automated credit scoring system. With peer to peer lending, a typical loan could be
funded by as many as 100 people, thereby increasing the chances your loan will get
funded. This type of loan is also known as person-to-person lending or social lending.
Read More
Partnerships
Seek a partner who has the funds to invest. You may have the knowledge but little
money. A partnership can be developed for a short period of time. You can construct an
agreement to buy that partner out at a later time.
Peer to peer lending is not a new concept but the Internet has made it easier. This type
of lending matches borrowers directly with lenders, circumventing banks and other
middle-men. Peer to peer lending is a great alternative to traditional banks’ stringent
automated credit scoring system. With peer to peer lending, a typical loan could be
funded by as many as 100 people, thereby increasing the chances your loan will get
funded. This type of loan is also known as person-to-person lending or social lending.
Read More
Partnerships
Seek a partner who has the funds to invest. You may have the knowledge but little
money. A partnership can be developed for a short period of time. You can construct an
agreement to buy that partner out at a later time.
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