How to Get Accounts Receivable and Inventory Financing - YouTube

How to get a business loan even when you think there's no way you can qualify.

Conventional banks have strict qualification requirements. There are not

a good place to look for startup loans or if you have poor personal credit.

Usually, they want two to three years of tax returns before they will lend you

any money. If you're lucky, you might get a single credit card. Over 89

percent of business applications are denied by the big banks.

What do lenders want to see, lenders generally want to know you have enough

assets, sufficient financial reserves and enough personal collateral to ride out

business fluctuations. How do loan applicants demonstrate this? Borrowers

must show solid cash flow, sufficient to repay the loan. A track record of

profitability and success in a similar business endeavor. Essentially, this is to

prove creditworthiness. Here's how equipment financing works. Get

financing to buy or lease new equipment. Used first and last month's payments for

approval. Rates vary widely based on risk factors can be approved with an average

credit of 650 or better. The lender will undervalue equipment by possibly up to

50 percent. This is on major equipment only, not a combination of a lot of small

equipment. You can get loans up to two million dollars.

What about equipment sale-leaseback, if you already own equipment free, use that

as collateral for financing. You sell the equipment to a lender for cash, then

lease it back from them. You need at least one larger piece of higher value

equipment to qualify. Funding is in as little as three weeks.

And then there's other kinds of collateral. Investors who want to buy and

flip properties can get financing. They must also have cash, experience, and

average credit. Get financing against commercial real estate. Insurance agents

can get book of business financing. SBA startup micro-loans might be an

option 7(m) is the SBA microloan program. There

are loans of up to thirty-five thousand dollars for working capital and growth. Average loan amounts

are about $10,000. Funds come directly from SBA. This is unlike the 7(a) where the

funds come from the bank. Cash flow financing is a possibility.

They often want you in business for at least a year. They want to see over

$10,000 in monthly deposits. They will work with borrowers with poor credit.

Essentially, you are using your business's cash flow like collateral.

Square and PayPal both offer loans with no personal credit check. This is an

option when a startup is just starting to become profitable. Both options depend

on sales. Square offers loans for $500 to $100,000. Eligibility depends on sales

history with Square. Sees squareup.com/capital. PayPal offers a

maximum loan amount of up to 30 percent of annual PayPal sales. A business can

get 5,000 to $500,000 but must have nine

months' time in business. See paypal.com. Unsecured business financing is another

way to go. Get five to eight times the amount of your highest credit limit rate

rate is 0 percent. Get up to $50,000. No collateral is

necessary. Hence the term unsecured. Business credit is a terrific solution.

This is credit linked to your EIN, not your Social Security number. This credit

is available without a personal guarantee. It's available regardless of

personal credit. You can get business credit immediately, even as a startup.

Building business credit helps throughout the life of a business. You

don't have to depend on lenders. And if you still want a loan, business credit

will get you better rates and terms. Let's recap. Conventional banks and loans

are a problem and so are private investors. Instead, get creative with

collateral. This includes cash flow financing or try the SBA for some forms

of loans. As these are often for startups, try Square and PayPal or unsecured

business financing and build business credit. And then you'll never have to

depend on lenders again. Contact us today to learn more about how

to get a business loan, even when you think there's no way you can qualify.