If you operate a small business, it is generally more difficult to obtain financing through traditional sources. That is why you need to learn more about alternative financing. One way you can find the funding you need online is to take out an unsecured business loan.
This type of loan is an ideal solution, whether you wish to obtain $1,000 or $300,000 in cash. You can obtain pre-approval in five minutes online and do not need to provide any security or collateral. In addition, you can enjoy a flexible repayment schedule.
Do You Need a Line of Credit?
If you wish to borrow over $300,000, you can still consider other loan packages. For instance, you can obtain an equity business loan, also known as a line of credit, for your start-up business. This loan term lasts from one to 36 months. You can even have bad credit. Pre-approval takes about one to three hours.
If you wish to obtain an unsecured business loans in Australia for $300,000 or under, you do need to be established. The loan terms for an unsecured loan are one to 12 months. When applying for this type of funding, you should have trading experience of at least six months. You also need relatively good credit and a regular turnover monthly of at least $6,000.
Why Type of Business Do You Operate?
An unsecured business loan is the ideal loan solution for the following types of new businesses:
- Restaurants and cafes
- Service businesses
- Retail stores
Determining Repayment for the Loan
The interest rates on this type of loan are usually reasonable and start at about 1.80% per month. Repayments are based on certain business criteria, especially your credit rating and monthly revenue. When applying for an unsecured business loan, you will need to provide six months of bank statements as well as your driver’s licence.
Again, you do not need to provide any collateral or security. The loan amount is secured based on the strength of a business. If you wish to borrow more money, you usually need to offer collateral, usually in the form of a vehicle or real estate property.
Do You Need Start-Up Capital?
When you apply for pre-approval, you will have to tell the lending source the amount of financing you need as well as the purpose of the loan. Therefore, you need to state the major reason for obtaining the loan. Some business owners use the loans to solve a cash flow problem whilst others use the money as start-up capital.
The lender needs to know these details so he or she can structure the pre-approval for the financing. Again, the credit history is considered. Because collateral is not typically required, the lender will take an applicant’s credit rating more seriously than he or she may for a secured loan product.