Bad Credit Business Loans
The struggle to find financing is real for many small businesses with bad credit. Traditional lenders may not issue bad credit business loans at all, or may do so at extremely high interest rates. P2P lending offers small businesses an alternative: quick, accessible loans based on your business health, not your credit score.
Loan Types: P2P Business Lending & Cash AdvanceAvailability: UK (£3000+ Per Month with 20% Margin UK Businessess)Securities: Both Unsecured & SecuredLoan amount: £1 – £100,000Interest: Cash Advance – No Fixed APR; Traditional Installments – Not AdvertisedOverall Rating: Innovative 4.5 / 5.0 About Fleximize Fleximize is an up-and-coming SME lender. Rather than lead with a traditional P2P investor/borrower approach to the loan process, Fleximize gets a cash infusion from investors, then makes it available to businesses in exchange for a fixed percentage
OnDeck Review in Numbers: 2020 Updated 💰 Loan Amount $5,000 to $500,000 💸 Loan Term 3 to 36 months ⛔ Unsecured? Secured by a general lien on business assets ⌚ Requirements Minimum of 3 years in business At least 600 Personal FICO score Annual revenue of $250,000 Have a business bank account ⭐ Client Reviews 98% 🌐 Website: Ondeck.com 🌝 Easy to Apply: Yes 📃 Required: Business Tax ID Bank statements for the previous 1 to 3 months Social Security
Loan Types: Merchant Cash Advance Availability: UK (Accepting Payments By Card) Securities: Against Invoices Loan amount: £2,500 – £300,000 Interest: Not Fixed, High Overall Rating: Helpful 3.7 / 5.0 About Liberis Liberis is a strong lender with a simple business model. They quickly approve and finance business operations for many reasons. Businesses pay them back by giving them a portion of daily credit card sales. On days where they make less, they contribute is less, until the balance is paid. Businesses
BlueVine Review in Numbers: 2020 Updated 💰 Loan Amount $5,000 to $250,000 💸 Loan Term 6 to 12 months ⛔ Unsecured? Secured ⌚ Requirements Different per product but standard term loan as follows: 600+ FICO 6+ months in business $10,000 monthly revenue ⭐ Client Reviews 92% 🌐 Website: Bluevine.com 🌝 Easy to Apply: Yes 📃 Required: Basic personal details 3 months most recent bank statements 💳 Minimal Interest Rates 4.8% 💌 Online Feedback: 4.6 / 5 Trust Score on TrustPilot
What Risks Are There to Bad Credit Borrowers Using P2P?
Because bad credit history often indicates inconsistent credit repayment, these companies are likely to issue loans to businesses at very high interest. The extra money is used to offset the loss incurred if a borrower defaulted. The higher the risk, the higher the interest. Still, because P2P high risk business loans may be the only available to bad credit businesses, and it can be paid off early before interest payments mount, it may be the only option.
What About Payday and Short-Term Personal Loans as an Alternative?
So-called Payday Loans are an often usurious lending form, meant to provide quick cash in a pinch, usually paid back in a matter of days of weeks. The practice is heavily regulated in some jurisdictions, not in others. Typically, borrowers will incur stratospheric interest rates which, depending on how you calculate interest on a loan with a few days’ term, have been recorded from 30% to 3000%+. With lots of bad press highlighting the folly of payday loans, businesses are much better served with business loans from reputable institutions, many of which in the P2P arena are more convenient than Payday lenders, without the risk.
Why Not Get a Bad Credit Business Loan From a Bank?
Because banks tend to look at your credit score first, many are immediately denied when requesting a traditional business loan. P2P lenders use a diverse array of data to determine your creditworthiness, including your online merchant history and other facets of your overall business health.
How Can You Improve Your Credit Score for Better Loan Terms?
There are many factors that determine your credit score. It is important to always pay debts and bills on time, to carry no more than a 30% balance out of your available credit, and to have as long a credit history as possible with old accounts from established institutions. There are other factors, but if these are observed alone, it’ll make a big difference in your credit score.