Archive for March, 2010

A Service Disabled Veteran Owned Small Business Serving The U.S. Government.

March 31st, 2010

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Alternate Financing For Small Business

March 31st, 2010

In a time when people are finding it hard to make ends meet, businesses are falling by the wayside. With money for operations hard to come by, many businesses are looking for alternate sources of business loans that were not available as readily a few years ago. Traditionally, money was borrowed from banks and the bank made their profit on the interest that was paid by the borrower for the privilege of working with them. Credit scores had to be high for business owners to get the money they needed for everything from payroll to inventory and collateral was often required to secure the loan. This collateral was used to mitigate risk. If the loan was in default, the bank could seize the asset and liquidate it to try to get most of the principal back so they would not have to take a loss on the money that was owed to them.

Alternative financing is exactly how it sounds. It comes in many forms including the very popular merchant cash advance, which has gained popularity in the past few years for its ease. You can get preapproved online and receive the money you need in a matter of days, rather than the weeks it can take to receive traditional bank loan funds. You will never have to worry about affording the payments as they come in the form of a percentage of gross credit card receipts, so if you have a bad month, you pay a little less than if you have a great month. This adds flexibility to this alternative and can be the perfect solution for business owners who need money very quickly without having to jump through hoops to get it. Mom and pop stores may never be able to qualify for bank loans, but the same kind of restrictions do not exist in the merchant cash advance world and anyone can qualify if you have credit card sales and can prove you have been in business for a certain amount of time, the advance is yours.