Financing Alternatives to Bank Loans

As the owner of a business, you have a lot of financial responsibility to keep up with. If you’re hesitant about acquiring funding because of the debt associated with it, know that you don’t always have to turn to the bank when you need money. There are a lot of benefits that you can experience when you turn to financial institutions for alternative lending solutions. The following are some alternatives you might want to consider before getting into bank debt.

One of the first types of financing to consider is an equipment sale and leaseback. Basically what happens is you sell your equipment to the lender, they lease it back to you for a low monthly cost, and you use the equity from the equipment as working capital within your company. After you have paid back the lease, your equipment is yours again. This does not involve serious debt and probably won’t make you suffer financially.

Another alternative lending solution to think about is a merchant cash advance. This works by your company selling future credit card purchases to the lender. They give you capital in return so that you can take care of the day-to-day financial issues that arise. They capitalize on the promise that you will make the sales and that they will get their money.

Something else to consider as an alternative lending option is an unsecured business line of credit. Typically used for short-term projects, this provides you the capital needed for things that might come up during the time you are working on the project. This also frees up other working capital and bank lines should you need to turn to those in case of emergency.

A bridge loan is a great solution for a business that might be in the middle of some sort of transition and does not have the money needed to pay for regular expenses. This might include moving from one location to another and having to pay two rent payments or two mortgages. It could also include being in the middle of a big equipment purchase and needing some extra money to pay employees until the equipment can do its job.

As you can see, alternative lending options come in many forms. If you are struggling with making ends meet for your business, there is a solution. Whether you could not qualify at a bank or are simply looking for another way to receiving funding, contact a lender today to learn more about the options available to you.