Business Loans: Ignition to a great Business

Hey, are you looking at yourself as a self-made star (as an Entrepreneur) in your near future? If  yes, then cheers to yourself !! You are at the right place. 

Let me tell you why it is so. 

You must be aware through your experiences till now that to ignite a business is not just about thinking and having started, right? It requires setting up a proper plan, of which investments form a vital part. 

Investment can be financial or non-financial. At this point, we could hardly relate to some idea that does not involve any sort of capital investment, So let’s come straight to the point. How to give a smooth ignition to our business idea, even the ones with a bad credit? As we proceed further, we shall be also familiar with the special benefits in  business loans that the Government has introduced for the welfare of the business beginners as well as the established business owners.

Have fun exploring !!

Option No. 1-The best of all 

One great option that seems right is going for Small Business Loans. This is the most popular case due to the fact that we often lack sufficient funds with us to start independently, and that’s completely okay. Being aware of the term what Small Business Loans (which also includes Small Business Loans with bad credits, of course) implies to : “a feature that supports someone to start a small scale or even a large scale business through the possible and available funding programs offered by the lender, indeed !!” 

However, the process of acquiring a business loan is not as easy. The process incorporates a hectic schedule of verifying the borrowers history, genuine needs for acquiring loans, application procedures , negotiating the interest rates and much more.

Still, it sounds much better than this, when we realise that we can not just drop down our ideal dreams due to a bad credit score, agree? 

Option No. 2- Just a thought to ponder upon

Then the second option that comes to our mind is taking the help of our relatives or friends. But doesn’t it sound like a risky business to take a business loan for a business idea they might not even appreciate us for and what if the idea doesn’t go our way, will our friends spare us anyway with their losses involved in it? While on the other way, we can just trust the banks which support us with a list of policies in case anything goes wrong, we should jump back to Option No. 1.

Alright, then coming back to the first option we had, now we need to explore the deeper depths about what sort of loans are available for us to be on the right business path. 

Also how to apply for a loan for our start-up when we have a bad credit history?

Steps for acquiring Small Business Loans:

 Here in this section, we shall be taking the steps to follow while acquiring for small business loans along with the ones with bad credits as well We will start from the very basic to the advanced steps.

(Also we shall consider the startup loans with bad credits.)

The steps are as follows:

Identifying the purpose: Foremost, we need to identify the purpose for which we need to acquire a business loan. To be more clear, is our company falling under one of these categories to business 

foundations :

Limited LiabIlity Company (LLC):this one aims for protecting collaterals, tax flexibility.

Corporation Company (CC): this one is named so because it gives opportunity to expand itself for public purposes in future

Doing Business As (DBA): this one is for bringing up the business name in real life.

Don’t worry, these names might seem complicated, but these are just the technical terms to a small-scale and large-scale business in general. Before going for any type, be it a small business loan, or a bad credit small business loan, we need to know about these more precisely, that’s why they have been mentioned here.

Looking for a trustworthy Lender: 

Once we have identified the foundation of our business for acquiring small business loans for startups, we need to look for a faithful lender. Usually, for many small business loans, especially the startup business loans, it is very hard to convince an investor/ lender to help us, but it is our prior right too, to check the loyalty background of the lender once we find them. 

This means we have all the rights to verify their satisfaction ratio while lending business loans, the unbiased interest rates, and their promises of co-operation and support in the entire deal.

Pro Note: Always look for an SBA authorised loan lender,for the best interest rates.(SBA loans shall be discussed further in the next section.)

The most co-operative Collaterals: 

The main question that arises is should we have even acquired a loan if we had huge assets with us before starting our startups? So, what is the logic at all behind the collaterals. To this, since this a legal procedure to be obeyed, what can be done in the least by the lender is that they should provide for the liniency in strict demanding for the complete collaterals. 

Yes,there do exist nice lenders too, that would help us out in our entire journey to startup- establishment !! Look for them, with wide eyes apart.

Now, once we have found the suitable lender for us, the next task is to see How do we acquire a Small Business Loan? 

To this, we have a variety of loan-providing companies with their own application procedures, interest rates, and additional features of benefits.

Some of them are named as: PayPal Working Capital, Lendio, Bluevine, Accion, OnDeck. Each of these have their own features to attract the borrowers based on their personal requirements. All it requires is thorough research and honest answering of the questions put up by the agencies/ loan lending companies.This helps them to analyse the best business loans with bad credit, for you, as a borrower. For instance, the borrower with a very bad credit could opt for the OnDeck as the best option.

     

During the Covid-19 outbreak, the Government has released the best funding ideas and platforms under the CARES Act. The legal authority, in the supervision of the President has brought into law ,the CARES Act which ensures to provide the best fundings which is around $350 billion as a relief amount to the needy small business ideas’. Moreover, keeping in mind the adversities that we all are facing, has introduced friendly ways of procedures of the startup business loans.

Some of these are mentioned as further :

SBA Loans and Fundings : 

The Small Business Administration (SBA) has released a set of programs under the President’s CARES Act, to ensure proper funding relief advantages to those in need of  the small scale business loans. 

SBA has initiated to pay for the borrowers their 6 months of principal with the interest rates, for all the current 7(a), 504, Microloans that belong to the borrowers. 

In addition it has also provided with the Disaster relief funds for the citizens to be free of any additional costs in association with their current Disaster Loans, under the SBA Serviced Disaster(Home and Business) Loans . 

SBA Express Bridge Pilot Program : 

The borrowers in relations  with the SBA lender shall now be benefitted under the CARES Act, as an initiative to help them during Covid-19 pandemic, with releasing them $20000-$25000, at the time of urgency. 

The complete procedures are taken into account without imposing much restrictions if the borrowers had maintained good relations in the past.

They can also apply for the SBA Express Disaster Bridge Program, in case of immediate requirements of help.The program ensures to give the best business loans even at bad credits.  

EIDL Emergency :

 

EDIL i.e. Economic Injury Disaster Loan Emergency have started to accept the advance applications for the urgent actions to be taken to the business startups requests for loans.

Also, the relief funds under EIDL Emergency covers most of the agricultural related issues, to give them the best aid at such an outbreak.

Payment Protection Program (PPP) : 

Another initiative under the CARES Act, in guidance of the SBA lender Services, Payment Protection Programs sims at giving the direct aid through the incentives to the small business startups loan-seekers. Also, the small business loans forgiven by the SBA lenders to the workers on payroll. Any trusted borrower in the good books of the SBA lending Services is allowed with his loan-forgiveness during the outbreaks. Moreover, they have decided to ignore the collateral at such difficult times. The current negotiated Interest Rate for the bad credit small business loans or the simple, small business startup loans is 1%.

Hence with an effective understanding and coordination between the lending services and the borrowers could prove of much help to a greater extent of saving the deserving businesses and startups through the small business loans and startups loans.