A Quick Guide to Alternative Business Financing
February 6th, 2019 by Advance Point Capital
More and larger banks are turning their focus to large customers, and it is why they often ignore small businesses. What should the small businesses do and how are they going to get the financing they need? Well, it is where alternative business financing come to your help.
Alternative business lenders are filling the gap that has been created by the large bank lenders. It means that you have more alternative business loan options available to you from the non-bank lenders. Now let’s look at some financing options that you can avail:
The loan amount of these loans varies from $10,000 to $500,000. The loan amount sanctioned depends primarily on monthly gross sales and not on the profit or loss that your business might be making. You get the approval within the day. The term may go up to 36 months, and repayment is also easy from the business bank account. You can get a business loan with a simple page application, and you will have to provide business bank statements for the review. Almost all the credit types are considered ranging from the excellent to the poor. But you can get a business loan if you are not a start-up business.
Lines of Credit
You can also secure flexible business lines of credit up to $100,000 as alternative business financing. With a repayment term spread over 12 months, you can get the flexible credit when you need it. Getting one may require you to provide your business bank statements for review, and you do not need to have an excellent credit rating to get one. Whenever you need credit, you can get the ready cash that you can payback easily within one year.
The lines of credit work in the same way as the credit card, you take the amount that you need, and you pay back with what to use. Earlier it was a challenge to get one approved from the traditional banks, but alternative business funding sources have made it easy and quick to make an online application.
It is an excellent option for you who have slow cash flow and have late paying customers. In invoice financing, lenders will advance you an amount that may range from 50 to 90 percentages of the outstanding invoice amount. Once the customer pays for the pending invoice, you will get the remaining percent of the amount that is pending leaving the fee which is owed to the lender.
Are you planning to finance new equipment for your business? You can get equipment financing from alternative business lenders. The lender can finance the 100% value of the equipment that you plan to purchase. The equipment serves as the loan collateral, and you pay back the loan as you would a term loan.
Merchant Cash Advance
It is an easy and straightforward financing option with which you can raise the cash by selling a portion of the future sales at a discount. You can get the advance cash ranging from an amount of $10,000 to $500,000. These advances do not come with a term limit, and you can repay a percentage of future sales. To get an advance, you will have to provide the business bank statements that show consistent cash flow. However, you will not have to provide tax return statements.
Thus you can get the financing for your small business from an alternative business lender like AdvancePoint Capital. Here is what you need to do:
- Make an application
- Submit the documents
- Wait for approval
- Get funds within 3-4 hours in the business bank account.