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by Fundid on Oct 13, 2023 8:00:00 AM
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As a small business owner with a credit score above 650, you have the advantage of accessing a wide range of loan options tailored to your needs. However, we understand that choosing the right loan for your business can be overwhelming, given the multitude of choices available. To help you make an informed decision, we have diligently compiled a comprehensive list of the best loans that you can confidently apply for with a credit score above 650. By providing you with detailed information and insights, we aim to empower you in navigating through this important financial decision and securing the financing that will fuel the growth and success of your business.
How a Business Loan Might Help Your Business
No matter the size and scope of your business, loan financing can be a useful tool for investing in growth. By taking out a loan, you may be able to purchase additional equipment or materials that would otherwise require an upfront payment. Similarly, you may use a loan to cover payroll expenses during slow periods or invest in marketing efforts that generate more leads and boost sales.
This can be a strategic move for experiencing substantial growth, managing cash flow, and increasing operational efficiency. A loan can provide the much-needed capital to invest in infrastructure, hire skilled personnel, expand to new markets, or even invest in marketing endeavors to reach a wider audience. Furthermore, a loan can also serve as a financial safety net during financial uncertainty or unexpected expenses. Leveraging these opportunities can significantly boost your business's profitability and competitive edge, contributing to its long-term success.
Related Reading: The Complete Guide to Small Business Loan
Short-Term Loan vs. Long-Term Loan
The choice between a short-term and long-term loan primarily depends on the specific needs and circumstances of your business. Short-term loans are typically suited for immediate needs such as managing cash flow, covering unexpected expenses, or funding small-scale projects. They offer quick disbursement of funds, usually have less stringent eligibility criteria, and can be repaid in a relatively short period of time.
Long-term loans, on the other hand, are generally used for larger investments such as purchasing real estate, substantial equipment, or investing in significant growth initiatives. These loans carry a longer repayment term spread over several years, usually at a lower interest rate. However, they often require a higher credit score and more thorough financial documentation.
Both short-term and long-term loans have their pros and cons, and the right choice will largely depend on your business's financial condition, your credit score, and your long-term business plans. It's essential to carefully assess your business needs, the loan terms, and capacity to repay before deciding.
Finding the Right Lending Partner for Your Business
Choosing the right lending partner is a critical aspect of securing a loan that best aligns with your business needs. Reputable lenders typically offer flexible terms, competitive interest rates, and various loan products, ensuring a suitable option for virtually every business scenario. Additionally, they often provide personalized customer service and financial advice, assisting you in understanding the loan process and making an informed decision. We've compiled a list of lenders that understand the unique challenges small businesses face and are, therefore, more willing to work with you regarding repayment options and loan customization.
Funding Circle Term Loan:
This is an excellent option if you are looking for a traditional term loan with a low-interest rate. Funding Circle is a peer-to-peer lending platform that helps connect small business owners with investors. They offer loans ranging from $25,000 to $500,000, with interest rates starting at 4.99% and terms ranging from 6 months to 5 years. The application process is simple and can be completed online, and you can receive funding in as little as 2 days.
Basic requirements:
- 660+ FICO credit score
- 2+ years in business
- $4,200+ in monthly revenue
Lendio Equipment Financing Loan:
If you need to purchase equipment for your business, this loan is a great option. Lendio is a business loan marketplace that connects small business owners with lenders. They offer equipment financing loans ranging from $5,000 to $5 million, with interest rates starting at 7.5% and terms ranging from 1 to 5 years. The application process is simple and can be completed online, and you can receive funding in as little as 24 hours.
Basic requirements:
- 650+ FICO credit score
- $4,200+ monthly revenue
- 1+ years in business
Lendio Start-up Loan:
If you are a start-up business owner, this loan is a great option. Lendio offers start-up loans up to $150,000, with interest rates starting at 6%. The application process is simple and can be completed online, and you can receive funding in 2-4 weeks.
Basic requirements:
- 680+ FICO credit score
- $6,000+ monthly revenue
- 3+ months in business
Paintbrush Commercial Loan:
Paintbrush provides a commercial term loan for early-stage startups through their banking partner, Continental Bank, member FDIC. Although slightly higher requirements, Paintbrush differs from Venture Capital in a very important way. As the owner, you are able to maintain full ownership of your company, and the loan is guaranteed by the founder with income-driven repayment.
Basic requirements:
- You make at least $100,000 a year
- 720+ credit score
- No time in business requirements
In essence, partnering with the right lender can provide more than just financial assistance—it can offer you the guidance, flexibility, and understanding necessary for your business to thrive. Making this crucial decision wisely could pave the way for sustained growth and financial stability for your business.
How to Check Your Credit Score
There are several ways to check your personal credit score. The first way is to sign up for an online service such as Experian or Equifax that offers free access to your credit report and score once a year. By signing up with one of these services, you can monitor your score over time and take steps to improve it if necessary.
You can also contact one of the three major bureaus—Equifax, Experian, or TransUnion—and request a copy of your report. Lastly, some banks offer free access to customers with their accounts at those institutions; be sure to ask if this service is available at yours!
Discover the Right Lender for You
As a small business owner with a credit score above 650, there are many loan options available to you. The key is to choose the loan that best suits your business needs. And don't forget to always read the fine print and carefully consider the terms and conditions of the loan before signing on the dotted line. Hopefully, this guide has helped you narrow your options and find the perfect loan for your business. However, if you're interested in seeing what other lenders are out there, visit our Capital Marketplace to find your perfect match and start growing your business today!
