Finance & Lending

 

09 10 2015

Benefits of Borrowing from an Alternative Lender

09 10 2015

The Benefits Of Borrowing From An Alternative Lender

Entrepreneurs starting a new business or owners trying to keep a long-running enterprise operating will most likely need a small business loan at some point or other. Despite being called a small business, these companies require large amounts of time and money to maintain operations.

The downside to traditional lenders

While many individuals might think about heading to their local big bank to apply for a loan, these traditional lenders have quite a few downsides that should make small business owners rethink their plan. These institutions typically require potential borrowers to jump through numerous hoops before they ultimately make their decision to approve a small business loan application.

This long, time-consuming process involves combing through the applicant’s credit history, financial statements, tax returns and financial reporting. Having to submit to this rigorous exercise eats up a company’s precious resources. In today’s fast-paced business world, not only do owners and managers simply not have the time to set aside to complete these tasks, but since so many companies operate on razor-thin profit margins, taking the time out of the day that could otherwise go toward converting leads or finalizing a sale means the company is losing out on crucial revenue just to fill out the paperwork traditional lenders require for a small business loan.

To make matters even worse, going through this drawn-out process does not even guarantee an approval. According to the Joint Small Business Credit Survey Report for 2014 commissioned by the four US. Federal Reserve banks, online lenders approve 38 percent of small business loans, compared to the smaller 31 percent approval rate from large national banks. This makes access to these needed funds much more readily available for those small businesses that need it most.

What makes alternative lenders different

With an alternative lender, the small business loan application process is remarkably simple and fast, with most applications approved within 24 hours. This means there’s minimal paperwork to complete, which saves business owners time and resources.

Traditional lenders often require owners to spell out exactly what the loan will be used for, and ultimately these lenders make their final decision not only on the company’s health and ability to repay the loan, but also on the feasibility of the loan’s purpose. This means even if the small business is relatively healthy and has a plan for paying off the loan, if the big bank lender does not approve of the plans, they will reject the application. Fortunately, alternative lenders allow business owners the freedom to use the loan for any business purpose, whether it’s to upgrade office technology, rebrand the company’s image or even pay down outstanding taxes.

These differences all make it significantly easier for cash-strapped small businesses to qualify for a loan approval. Despite all the benefits, some owners might hesitate to work with an alternative lender because they erroneously believe the interest rates on the loan will be sky high. However, as Entrepreneur aptly noted, many alternative lenders offer single-digit interest rates no different than traditional lenders. Although, it should be noted that borrowers who are considered riskier might see slightly higher rates.

The incredibly high standards set by traditional lenders can be a major barrier for small businesses looking to purchase more inventory or expand into new markets. For fast, convenient, no-hassle loans, small businesses should consider an alternative lender.

With National Funding, small business loan recipients can obtain loans up $500,000 with no collateral. For those owners who pay off the loan early, there are discounts to be had. In addition, these loans can offer potential tax savings as well. The application process is simple; watch our video, and learn how to apply for a small business loan.

­­

Find Out How Much Funding You Qualify For

Fields marked with an * are required
By clicking this button I agree to all terms and conditions.

Terms & Conditions

General Acceptance

Any applications submitted electronically shall have the same force and effect as if the application bore an inked original signature(s). The above information, together with any accompanying financial statements, schedules, or other materials, is submitted for the purpose of obtaining credit and is warranted to be true, correct, and complete.

 

US Patriot Act:

To help the United States Government fight terrorism and money laundering, Federal law requires us to obtain, verify, and record information that identifies each person that opens an account. What this means for you: when you open an account, we will ask for your name, a street address, date of birth, and an identification number, such as a Social Security number, that Federal law requires us to obtain. We may also ask to see your driver's license or other identifying documents that will allow us to identify you.

 

For Loan/Merchant Services:

The Merchant and Owner(s)/Officer(s) identified in the application (individually, an “Applicant”) each represents, acknowledges and agrees that (1) all information and documents provided to National Funding, Inc. (“NF”) including credit card processor statements are true, accurate and complete, (2) Applicant will immediately notify NF of any change in such information or financial condition, (3) Applicant authorizes NF to disclose all information and documents that NF may obtain including credit reports to other persons or entities (collectively, “Assignees”) that may be involved with or acquire commercial loans having daily repayment features and/or Merchant Cash Advance transactions, including without limitation the application therefor (collectively, “Transactions”) and each Assignee is authorized to use such information and documents, and share such information and documents with other Assignees, in connection with potential Transactions, (4) each Assignee will rely upon the accuracy and completeness of such information and documents, (5) NF, Assignees, and each of their representatives, successors, assigns and designees (collectively, “Recipients”) are authorized to request and receive any investigative reports, credit reports, statements from creditors or financial institutions, verification of information, or any other information that a Recipient deems necessary, (6) Applicant waives and releases any claims against Recipients and any information-providers arising from any act or omission relating to the requesting, receiving or release of information, and (7) each Owner/Officer represents that he or she is authorized to sign this form on behalf of Merchant.(8) I consent to receive direct mail, faxes, and e-mails sent by National Funding and its affiliates for the purposes of transmitting account updates, requests for information and notices, and (9) this request is for business and not for consumer purposes.

 

For Equipment Services:

I hereby certify: (1) the information provided is true and correct, (2) you are hereby authorized to investigate all bank, credit, and trade references, and said references are hereby authorized to release any requested information to you or your nominee, (3) such authorization shall extend to obtaining personal credit profile in considering this application and subsequently for the purposes of update, renewal or extension of such credit or additional credit and for reviewing or collecting the resulting account, (4) this information may be transmitted by us to you and by you to underwriter(s) for the purpose of granting me credit, either electronically or manually, and that by submitting this application, I take full responsibility for transmission thereof, (5) I am over 18 years of age, (6) I acknowledge my rights under the Fair Credit Reporting Act, (7) I consent to receive direct mail, faxes, and e-mails sent by National Funding and its affiliates for the purposes of transmitting account updates, requests for information and notices, and (8) this request is for business and not for consumer purposes.

The Federal Equal Credit Opportunity Act prohibits creditors from discriminating against credit applicants on the basis of race, color, religion, national origin, sex, marital status or age (provided the applicant has the capacity to enter into the binding contract); because all or part of the applicant’s income derives from any public assistance program; or because the applicant has in good faith exercised any right under the Consumer Credit Protection Act. If for any reason your application for business credit is denied, you have the right to a written statement of the specific reasons for the denial. To obtain the statement, please write to National Funding Inc., 9820 Towne Centre Drive, San Diego, California 92121.  Funding amount and credit approval is subject to a full credit profile review.