Fast working capital loans can help to get your business back on its feet quickly before your cash flow is hampered or stalled. The funds borrowed can be utilized to cover your regular monthly expenses until your company profits are realized through the successful sale of products and collection of outstanding debts owed to you by your customers. A fast working capital loan can also be utilized to provide short-term assistance to your company during an emergency. One of the most common questions that business owners ask about these loans is whether there is a way to secure funding without having to pledge collateral.
To answer this question it is first necessary to look at the difference between a fast working capital loan and a line of credit. A line of credit is designed to provide cash to you based upon the availability of your credit score. This may not necessarily be an accurate assessment of your financial situation, especially if you have had some late payments in the past. If this is the case, then it may not be feasible for you to obtain financing without placing your property at risk.
On the other hand, secured fast working capital loans do not require you to place your property at risk. Instead, you are required to offer a form of collateral – usually your home or car – which is worth enough to secure the funds that you are borrowing. Generally, you will receive the funds very quickly.
And because you have offered actual tangible assets as collateral you will not have to deal with the often lengthy and drawn-out process of obtaining a traditional small business loan. Once your application has been approved, you will receive the funds immediately and you are free to use them however you see fit.
The downside to this fast working capital loans option is that they are not available to everyone. Your credit score is assessed before approval and if it is below the level that would qualify you for financing, then you may not even be approved for the loan.
Because of this requirement, it may be a good idea to consult qualified small business finance professionals before applying for such financing. These professionals know lenders and will be able to give you the proper advice as to whether or not this type of financing would be a good option for your small business. And if it is not, then they can assist you in finding another lender who will make it possible for you to receive the funds that you need.
There are several different types of fast working capital loans that small businesses can obtain. One of the most popular options is to obtain cash advances. Cash advances are not loans, but they are a revolving line of credit that can be accessed when needed. Some of these advances are available for as little as one week and others may be available for as long as ninety days.
Another popular option that small business owners may want to consider is to get start-up funding. To obtain start-up funding, you may be required to offer collateral or you may be asked to use some type of personal credit guarantee. These start-up business loans are great for those entrepreneurs who do not have a great deal of start-up capital to invest in their new business.
You can receive start-up business loans that require a lower percentage interest rate than other start-up business loans. And while these start-up business loans typically do not carry as high of a percentage rate as other financing options, they are perfect for the fast working capital business loans that are provided by many financing agencies.