No company ever wishes to get to the stage where it has to take a loan for its business. However, keep in mind that no matter what the stage of growth your corporation is in, at some point you’ll be needing a certain amount of money.
It doesn’t always have to be because your business is in a difficult situation. From time to time, a little extra cash is necessary to speed up some things concerning your company. Now, during COVID-19 it’s completely understandable to apply for one.
If it’s urgent and you need the money as quickly as possible, then you must consider some alternatives that will help you obtain it. Do you need a same day business loan, a fast business loan, or an emergency business loan? Think about it and in the meantime, take a look at these tips that just might give you some answers.
What Can You Do?
Determine The Type of Loan
Before you continue with this process, you first have to figure out what type of loan you actually need. Furthermore, lenders would want to know why you need additional money and in that case, you have four options to consider:
- Need it to launch a company
- To handle costs that you have on a daily basis (think inventory and payroll)
- To secure a safety net
- To expand your business
Based on your reasons, the bank will determine the type of loan you can acquire. Keep in mind, that if you’re just starting a business, you probably won’t be able to obtain a loan from an online lender or a bank during your first year.
The Best Fast Business Loans
There are a couple of fast business loans at your disposal that you might want to consider. It doesn’t hurt to get yourself familiar with them before you go to the bank. Here’s some information about a couple of them.
- Short-term business loans are generally good because unlike traditional loans, they have high approval rates and they are quite quick and efficient. It usually takes them one day to fund in. Sometimes, it takes even less.
- Short-term business lines of credit are a good option if you want to obtain a smaller amount of cash and at the same time pay only interest costs on the amount you are utilizing. It is as equally fast as short-term business loans.
- A business cash advance is a Future sales receivables purchase contract. How does it work? Business owners can quickly obtain the money by selling a piece of their future sales at a discount to a funder. Once this occurs, he/she will receive the money for his/her company. These loans are extremely fast and have higher approval rates than that of both short-term business loans and traditional.
There are two more options that you can also consider, business or personal credit cards and equipment leasing. Both of these options are great and can offer a way to fund your business needs.
Is There Anything Else You Need To Know?
Know Your Credit Score
A lender can be quite difficult to work with, especially if you do not seem trustworthy enough. That means that each business looks different in the eyes of the lender. More importantly, if you want to get the loan, your lender must perceive you as a trustworthy person.
That’s why it’s important to have a solid credit score, otherwise, if it isn’t it can negatively affect your rates, as well as overall financing expenses. Therefore, keep always in mind that you should build your credit score.
Choose a Good Lender
This is also one of the key things when considering getting a business loan. Financial experts at BSTCredit.com.sg claim that there are three kinds of lenders that can give you the loan. They include the bank, online lenders, and nonprofit microlenders.
When to use each of them? The bank should be used if you have solid credit, when you don’t need money quickly and when you can provide collateral. Hire online lenders you need to get money fast, you lack collateral and you also lack time in business.
And last, but not least – microlenders. People usually use them when they are not able to acquire a traditional loan because the corporation is too small. Carefully see the option they are giving and then pick the most suitable one.
All these tips we listed in the article can only benefit you, however, they haven’t covered every single aspect that needs to be considered. Therefore, it’s recommendable to take some time and perform research before filing a business loan application because only then you will figure out which option really works for you.
Do you need a same day business loan?
A Comprehensive Guide to Different Types of Small Business Loans