The Great Recession has so badly affected the economy the world over that many individuals have ended up with poor credit scores. In fact there are many individuals whose business have suffered so much that they are unable to get a business loan. As such it has given rise to a complex situation where credit forms an integral part of their business.
But with the economy recovering slowly but surely, many businessman are looking for ways and means to improve their business, invest in different schemes, work with new people and open up branches in different locations. And when the interest rate is low, it is a good idea to take your debt head-on. There are very few financial institutes that are willing to give bad credit personal loans.
But every problem has a solution. Read on to know more:
- Micro-loans: when we talk about micro-loans we are talking about loans that are less than $50,000. These loans are normally given by a financial agency or a nonprofit organization. These loans are mainly given to boost the morale of an organization and the lenders are more lenient about the terms and conditions and they are not so bothered about the borrower’s credit performance.
- Make the most of Your Revenues: if your business is making profits and you are able to make consistent deposits in your bank then use this credit score to get loans for bad credit. The lender will look at your credit and depending on the revenue generated by your business, will give you the loan. Generally it is not more than 10% of the profit generated by your business.
This type of loan is generally availed within a week but the rate of interest charged is a bit higher than the market rate.
- Tap into Your Credit Card Sales: if you have a proper credit card sales, lender will be willing to give you loans with bad credit provided the future of your credit sales is good. This is referred to as “merchant cash advance.”
However, we recommend that you find out about the rate of interest to be charged on the loan given. The most common way to repay the loan is to pay off the daily amount spent before you go ahead and clear of the cash advance. Some lenders are also comfortable if you opt for monthly installments as well.
- Find a Co-signer: and finally another way how to get a loan with bad credit is through a co-signer. It can be your friend or your business partner who is willing to co-sign the loan. This will give confidence to the lender with regard to the payment of the loan.
The Bottom Line:
There are many who have not been able to recover the great economic recession. However, they are on the lookout for ways that will help them to make the most of the situation. In order to tap the above options, do have a thorough discussion with your financial advisor to find out whether it will work out for you or not!