When starting a business, entrepreneurs are often eager to obtain financing. However, lenders typically require a strong personal and business credit history before approving business loans. This article reviews some of the best small business loans no credit check options to help borrowers find the right funding source.
Many online lenders offer a variety of small business loans without credit checks. Applicants can use a loan calculator to determine their ideal loan terms and rates before applying. However, many of these lenders have a minimum credit score requirement of at least 580, which makes it difficult for some entrepreneurs to qualify for the full amount they need. In addition, these types of loans typically carry higher interest rates than traditional loans.
One of the most popular options for a small business loan no credit check is PayPal Working Capital, which provides up to $250,000 in financing based on a company’s average monthly debit and credit card sales totals. This lender offers a fast application process and competitive interest rates. The catch, however, is that the lender requires a business to already use Square’s point-of-sale system, so it’s not a good fit for all businesses.
Another great option for small business loans no credit check is a revolving line of credit. This type of financing works much like a business credit card, with borrowers being charged interest only for funds they withdraw from their designated credit limit. This lender has flexible repayment terms and requires no initial application fee. It’s also a great option for companies that frequently need to borrow money as they scale up and down.
For a more comprehensive list of the best small business loans no credit check, see NerdWallet’s top picks. The website also includes a tool that allows you to compare the terms of multiple lenders at once, eliminating the need for entrepreneurs to send their financial documents to dozens of different lenders at once.
Those with poor credit can still get a small business loan by offering up some sort of collateral such as real estate or valuable equipment. The lender will then take possession of the asset if the business fails to repay the loan. However, this will add to the overall cost of the loan and can be complicated for business owners to manage.
Another option is to seek out a friend or family member who can act as a guarantor. This person would promise to pay back the loan if the business fails, and they may only want a small percentage of the company in exchange for their support. Finally, a venture capital firm that specializes in providing small business loans to startups and established companies may be able to provide the capital you need, although they will require a thorough application process and extensive documentation. Getting the most favorable small business loans no credit check can be a challenge, but research and shopping around can make all the difference.