28 Sep Getting an Unsecured Small Business Loan
Are you a startup business looking to finance your new venture? Finding the right lender and type of loan can be a confusing and tedious process so you need all the help that you can get.
A new firm, a startup clothing store, or an established coffee shop looking to expand further all qualify as small businesses. Such ventures require a decent capital in growing their brands. They might need help on the financial side in opening up one more store in their area, or just revamping their image considering the competitive nature of businesses.
If you are a small business owner, small business loans can help your business grow and eventually enhance your marketing and sales. Most business loans fall into one of two categories – secured or unsecured. An unsecured business loan is a type of loan that is not secured against any asset or property. It means that the lender doesn’t really require any collateral or personal guarantee. Sounds too good to be true? Not really. There are lenders which offer this type of loan to small business owners. It is understood that small businesses are just starting up and hence, haven’t really established any assets or collateral to secure a loan with. However, since it’s a higher risk for the lender, an unsecured business loan usually comes with a higher interest rate. But that’s not to say it’s a bad option at all.
In getting an unsecured business loan, an amount is lent against the cash flow of a business. This shows that this type of loan is a better option for businesses as long as they provide a profitable service without needing a collateral or asset. For more information in regards to securing an unsecured business loan, you may contact your local finance broker to see which lenders offer this and what requirements they seek.
To increase your chance of securing a business loan, make sure you’ll be able to prove consistent monthly revenue. You might want to make sure your credit history is spotless. It also helps if you are an operating business for 2 years. Establish your business to be as professional as possible.
As a small business owner, you don’t have to struggle with loan applications just because you lack knowledge about the processes and details. Professional help is always available and just feel free to ask. If there’s a will, there’s a way!
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This article provides general information only and has been prepared without taking into account your objectives, financial situation or needs. We recommend that you consider whether it is appropriate for your circumstances and your full financial situation will need to be reviewed prior to acceptance of any offer or product. It does not constitute legal, tax or financial advice and you should always seek professional advice in relation to your individual circumstances. Subject to lenders terms and conditions, fees and charges and eligibility criteria apply.