As many small business owners have discovered the hard way, in order to get, sometimes you have to give. This is especially true when it comes to obtaining loans. Oftentimes lenders will require owners to pledge collateral against a loan. However, this isn’t always a viable option for business owners, which is why an unsecured business loan may be the ideal alternative.
Business Loans with No Collateral
Essentially, an unsecured business loan is a loan that is issued without collateral being put forth on the part of the borrower. Traditional lenders might require you to put your home or some other type of asset on the line in order to qualify for funding, but an unsecured business loan does away with this requirement.
Lenders use secured loans as a way to cover their bases in case the borrower defaults. This way, even if a business owner is unable to pay back their loan, the lender has some recourse in the form of selling whatever asset has been pledged to cover the costs.
Unfortunately for business owners, they may not always have the collateral necessary to access the cash they need. However, even if an owner does have assets that can be used to secure a business loan, they may not want to put personal property on the line for a business matter.
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Qualifying for an Unsecured Business Loan
Some lenders make it quite difficult to qualify for an unsecured business loan. Because they are taking on more risk, they will have much more stringent qualifying standards intended to show them a borrower has a low chance of defaulting on their loan.
This could include a spotless credit report, a detailed business plan and more.
However, at National Funding, we’re dedicated to tailoring loans to fit the needs of small business owners, and that means lending without collateral.
For instance, our merchant cash advance provides business owners with up to $250,000 cash without collateral. We can do this thanks to our special repayment method of taking a small fixed percentage of your daily credit card sales transactions.
Qualifying for this type of loan is easy. The simple criteria you must meet are at least one year in business and monthly credit card transactions averaging at least $3,000. With no fixed payments, hidden fees or upfront costs, a merchant cash advance could be the ideal solution if you’re seeking an unsecured business loan.
At National Funding we will never require collateral, so if a cash advance for your business isn’t the right solution, we have many other business financing options available that can be tailored to your needs. Contact National Funding today to explore how our unsecured business loan options can help you meet your goals.