No Result
View All Result
SUBMIT YOUR ARTICLES
  • Login
Monday, October 27, 2025
TheAdviserMagazine.com
  • Home
  • Financial Planning
    • Financial Planning
    • Personal Finance
  • Market Research
    • Business
    • Investing
    • Money
    • Economy
    • Markets
    • Stocks
    • Trading
  • 401k Plans
  • College
  • IRS & Taxes
  • Estate Plans
  • Social Security
  • Medicare
  • Legal
  • Home
  • Financial Planning
    • Financial Planning
    • Personal Finance
  • Market Research
    • Business
    • Investing
    • Money
    • Economy
    • Markets
    • Stocks
    • Trading
  • 401k Plans
  • College
  • IRS & Taxes
  • Estate Plans
  • Social Security
  • Medicare
  • Legal
No Result
View All Result
TheAdviserMagazine.com
No Result
View All Result
Home Financial Planning Personal Finance

How to Get a Business Loan With Bad Credit

by TheAdviserMagazine
4 months ago
in Personal Finance
Reading Time: 9 mins read
A A
How to Get a Business Loan With Bad Credit
Share on FacebookShare on TwitterShare on LInkedIn


A low credit score doesn’t have to shut the door on your business goals. But it can make the path to funding a bit bumpier.

The good news? Many lenders look beyond just credit scores, considering factors like how long you’ve been in business, revenue and whether you have collateral.

From working with online lenders to requesting a smaller loan, there are strategic ways to improve your chances of getting approved for a small-business loan.

What is bad credit and why does it matter?

NerdWallet defines bad credit as a personal credit score below 630. Lenders often look at your personal credit score as a way to gauge how likely you are to repay borrowed funds. A bad score signals higher risk, which can make approval harder to come by.

We’ll start with a brief questionnaire to better understand the unique needs of your business.

Once we uncover your personalized matches, our team will consult you on the process moving forward.

How to boost bad credit loan approval odds

Here are some practical ways to improve your chances of getting approved for a small-business loan if your credit score isn’t ideal:

Offer collateral

Collateral is any asset you own that you use to secure a loan. Because lenders can take your collateral if you fail to repay a secured loan, these loans often have more lenient credit requirements.

Ask for less money

If you can get by with less, you may be able to increase your odds of being approved by simply asking for a smaller loan amount. Our analysis of NerdWallet’s small-business loans data shows that the lower the self-reported credit score of approved borrowers, the lower the average funding amount they received.

Consider a co-signer

You may be able to offset a poor credit history by asking a trusted friend or family member with strong credit to co-sign on a business loan. But keep in mind that a co-signer will be on the hook for any loan payments you miss, which can jeopardize your personal relationship if that happens.

Improve your bad credit score

This will likely take some time — and you might not be able to wait for funding right now — but it’s still worth working on raising your credit score as it can open the door to better loan offers in the future.

There are several ways that you can improve your credit score. First, make sure you’re on top of your current payments and paying your bills on time. Also, go over your credit report carefully and dispute any errors that you find. You might also consider becoming an authorized user on someone else’s credit card (so long as that person is responsible and has good credit).

Build your business credit, too

While lenders will still consider your personal credit score, building a strong business credit profile may help your approval odds. To get started, you’ll need to apply for an employer identification number with the IRS (if you haven’t already), as well as a DUNS number with Dun & Bradstreet, a business credit bureau. That way, your business activity, such as payments on a loan or credit card, can be tracked and accessed by lenders via your unique DUNS number. Any business activity reported to business credit bureaus is used to inform your business credit score.

After you have those, opening a business credit card can be a smart way to lay the foundation for your business credit history. Business credit cards are sometimes easier to qualify for than loans and can help cover short-term expenses.

Choose the right lender

Not all lenders work with borrowers who have bad credit. Focus your search on those that do. Online lenders are a good place to start. But watch out for predatory lenders with too-good-to-be-true promises. A reputable business loan broker, like Fundera by NerdWallet, can help guide you or you can start with our list of the best bad credit business loans.

Loan options for bad credit borrowers

While traditional banks might turn you away if you have bad credit, you may still be able to access financing through online lenders and by exploring alternative solutions.

Online loans

Best for: Entrepreneurs who need fast cash and can manage higher interest rates.

Online lenders are non-bank companies that offer loans that are typically easier to qualify for and fund faster compared with bank loans.

But there’s a catch: Loans from online lenders generally have higher interest rates and shorter repayment terms when compared with traditional business loans.

Online lenders may offer a variety of loan types, including term loans, business lines of credit, merchant cash advances, equipment financing and more.

Microloans

Best for: Entrepreneurs who need $50,000 or less.

Microloans are small-dollar loans designed for business owners working to build or repair credit, individuals from historically underserved communities and new businesses.

They typically provide up to $50,000 in funding and are offered by nonprofit organizations and lenders who participate in the SBA microloan program.

Equipment loans

Best for: Entrepreneurs who need to finance equipment for their business, such as machines, office furniture or semi trucks.

Equipment financing may have more lenient credit score requirements than other types of business loans, since the equipment you buy with the loan serves as the collateral.

Invoice factoring

Best for: Business-to-business companies with slow-paying customers.

Invoice factoring involves selling your unpaid invoices to a third-party company, known as a factoring company. Because factoring companies collect from your customers instead of you, your personal credit plays a smaller role in the approval process.

Merchant cash advances

Best for: Entrepreneurs with healthy profit margins and few financing options to choose from.

Like invoice factoring, merchant cash advances (MCAs) are not technically loans. Instead they’re an advance of cash you repay using a percentage of future sales, plus fees. Because MCA providers focus more on sales history when considering new borrowers, a bad credit score is less likely to stand in the way of approval.

However, they’re one of the most expensive forms of business financing, so explore other options before considering an MCA.

Consider other alternatives

If the options above don’t fit your needs, here are a few more worth exploring:

Small-business grants. This is free money awarded to entrepreneurs who put in the time and effort to apply. While the competition is often steep, the potential payoff may be worth the effort.

Crowdfunding. This involves raising money yourself on online platforms, like Indiegogo or Kickstarter. Depending on the type of crowdfunding you choose, you’ll be on the hook to deliver a product or service, give away a piece of your company or repay the raised funds.

Friends and family loans. If you have trusting family members or friends willing to lend you cash for your business, consider yourself lucky. While this can be a flexible and cheap way to get funding, it can put your personal relationships at risk. To avoid misunderstandings, we recommend putting everything in writing, including timelines, repayment terms and any interest, so both sides are on the same page from the start.



Source link

Tags: badBusinessCreditloan
ShareTweetShare
Previous Post

Is Walmart Open on the 4th of July 2025?

Next Post

Is Microsoft Stock About to Go Nuclear?

Related Posts

edit post
*HOT* Bose SoundLink Flex Bluetooth Speaker only .99 shipped (Reg. 9)! {Today Only}

*HOT* Bose SoundLink Flex Bluetooth Speaker only $89.99 shipped (Reg. $149)! {Today Only}

by TheAdviserMagazine
October 26, 2025
0

Score a hot deal on this Bose SoundLink Flex Bluetooth Speaker! Today only, HSN has this Bose SoundLink Flex Waterproof...

edit post
Meet Heidi Hallmark: A Bookkeeper Helping Women Find Peace of Mind in Their Finances

Meet Heidi Hallmark: A Bookkeeper Helping Women Find Peace of Mind in Their Finances

by TheAdviserMagazine
October 25, 2025
0

One of my favorite things to do is highlight women who have taken their gifts and used them to build...

edit post
*HOT* Shark Cyclone Pet Handheld Vacuum only .99 shipped! (Reg. ) {Today Only}

*HOT* Shark Cyclone Pet Handheld Vacuum only $24.99 shipped! (Reg. $70) {Today Only}

by TheAdviserMagazine
October 25, 2025
0

Here’s a great deal on this Shark Handheld Vacuum! HSN has this Shark Cyclone PET Handheld Vacuum with XL Dust...

edit post
Your Top October Money Questions Answered

Your Top October Money Questions Answered

by TheAdviserMagazine
October 24, 2025
0

The investing information provided on this page is for educational purposes only. NerdWallet, Inc. does not offer advisory or brokerage...

edit post
Mortgage Rates Inch Toward 6% as Fed Weighs October Cut

Mortgage Rates Inch Toward 6% as Fed Weighs October Cut

by TheAdviserMagazine
October 24, 2025
0

Mortgage rates fell for the fourth consecutive week, finally nearing 6% for the first time since September 2024. Lenders and...

edit post
*HOT* FREE LEGO Harry Potter Flying Car Set after cash back!

*HOT* FREE LEGO Harry Potter Flying Car Set after cash back!

by TheAdviserMagazine
October 24, 2025
0

This LEGO Harry Potter Flying Car Set is so cute! Looking for a fun new LEGO set to build? Top Cash Back is...

Next Post
edit post
Is Microsoft Stock About to Go Nuclear?

Is Microsoft Stock About to Go Nuclear?

edit post
How I Finally Found Time to Read Again and How You Can Too

How I Finally Found Time to Read Again and How You Can Too

  • Trending
  • Comments
  • Latest
edit post
77-year-old popular furniture retailer closes store locations

77-year-old popular furniture retailer closes store locations

October 18, 2025
edit post
Pennsylvania House of Representatives Rejects Update to Child Custody Laws

Pennsylvania House of Representatives Rejects Update to Child Custody Laws

October 7, 2025
edit post
What to Do When a Loved One Dies in North Carolina

What to Do When a Loved One Dies in North Carolina

October 8, 2025
edit post
Another Violent Outburst – Democrats Inciting Civil Unrest

Another Violent Outburst – Democrats Inciting Civil Unrest

October 24, 2025
edit post
Probate vs. Non-Probate Assets: What’s the Difference?

Probate vs. Non-Probate Assets: What’s the Difference?

October 17, 2025
edit post
California Attorney Pleads Guilty For Role In 2M Ponzi Scheme

California Attorney Pleads Guilty For Role In $912M Ponzi Scheme

October 15, 2025
edit post
Asked on Reddit: Should I Pay Off Loans or Save?

Asked on Reddit: Should I Pay Off Loans or Save?

0
edit post
Accel and Prosus team up to back early-stage Indian startups

Accel and Prosus team up to back early-stage Indian startups

0
edit post
EUR/USD Teeters Near Key Fibonacci Level Ahead of This Week’s US CPI Test

EUR/USD Teeters Near Key Fibonacci Level Ahead of This Week’s US CPI Test

0
edit post
Key metrics from American Airlines’ (AAL) Q3 2025 earnings results

Key metrics from American Airlines’ (AAL) Q3 2025 earnings results

0
edit post
Bed Bath & Beyond Q3 2025 Earnings Preview (BBBY:NYSE)

Bed Bath & Beyond Q3 2025 Earnings Preview (BBBY:NYSE)

0
edit post
OBBB Limits Tax Credits for ITIN Filers Without SSNs

OBBB Limits Tax Credits for ITIN Filers Without SSNs

0
edit post
Milei’s party on track to win Argentina election in big comeback

Milei’s party on track to win Argentina election in big comeback

October 26, 2025
edit post
HSBC to recognize .1 billion in provision after court ruling in Madoff case

HSBC to recognize $1.1 billion in provision after court ruling in Madoff case

October 26, 2025
edit post
Accel and Prosus team up to back early-stage Indian startups

Accel and Prosus team up to back early-stage Indian startups

October 26, 2025
edit post
What Saudi Arabia and Bangladesh can teach Silicon Valley

What Saudi Arabia and Bangladesh can teach Silicon Valley

October 26, 2025
edit post
US And China Signal Progress In Kuala Lumpur; Crypto Traders Take Notice

US And China Signal Progress In Kuala Lumpur; Crypto Traders Take Notice

October 26, 2025
edit post
Here are the major earnings before the open Monday

Here are the major earnings before the open Monday

October 26, 2025
The Adviser Magazine

The first and only national digital and print magazine that connects individuals, families, and businesses to Fee-Only financial advisers, accountants, attorneys and college guidance counselors.

CATEGORIES

  • 401k Plans
  • Business
  • College
  • Cryptocurrency
  • Economy
  • Estate Plans
  • Financial Planning
  • Investing
  • IRS & Taxes
  • Legal
  • Market Analysis
  • Markets
  • Medicare
  • Money
  • Personal Finance
  • Social Security
  • Startups
  • Stock Market
  • Trading

LATEST UPDATES

  • Milei’s party on track to win Argentina election in big comeback
  • HSBC to recognize $1.1 billion in provision after court ruling in Madoff case
  • Accel and Prosus team up to back early-stage Indian startups
  • Our Great Privacy Policy
  • Terms of Use, Legal Notices & Disclosures
  • Contact us
  • About Us

© Copyright 2024 All Rights Reserved
See articles for original source and related links to external sites.

Welcome Back!

Login to your account below

Forgotten Password?

Retrieve your password

Please enter your username or email address to reset your password.

Log In
No Result
View All Result
  • Home
  • Financial Planning
    • Financial Planning
    • Personal Finance
  • Market Research
    • Business
    • Investing
    • Money
    • Economy
    • Markets
    • Stocks
    • Trading
  • 401k Plans
  • College
  • IRS & Taxes
  • Estate Plans
  • Social Security
  • Medicare
  • Legal

© Copyright 2024 All Rights Reserved
See articles for original source and related links to external sites.