Each Decision Is Crucial To A Small Business’ Success
If you are a small business owner, then you want to make the best decisions possible for your company. The financial decisions that you make can make or break your company. For continued growth and success, consider some of these important decisions.
Consider A “Hard Money” Loan
The decisions that you make concerning your business’ capital will no doubt end up being some of the most crucial. If you need more capital to grow your business but are having a difficult time securing said capital, you are faced with a difficult decision. One helpful solution is what is called a “hard money” loan. This type of loan is backed by collateral (often real estate, including residential properties, commercial properties, or land). Typically, this type of loan serves as a “bridge loan” for small businesses.
Advantages Of Hard Money Loans
Hard money loans are popular because they have several advantages for small businesses. Here are just a few of the advantages of theseloans for small businesses:
- They are easier to obtain for new businesses or businesses with less than perfect credit
- They typically have a quick and easy approval process
- They provide a much-needed influx of cash
Because hard money loans are backed with real estate, the credit score requirements are much less stringent than with most other types of loans. This, in turn, tends to make the approval process quicker and easier than that of other loans. If you are a new small business – or a small business whose credit is not exactly stellar – a hard money loan can provide you with the quick influx of cash that you need. This could be a lifesaving financial decision for your business.
Business Factoring
Another quick and reliable way to meet your small business’ cash needs is a transaction known as “business factoring.” Through small business factoring, your small business would sell its accounts receivable (including invoices) to a 3rd party (in this case, referred to as a “factor”). As with hard money loans, business factoring has many advantages:
- Helps you easily cover funding gaps
- Allows you to settle invoices when customers are slow to pay
- Easy approval process
- Gives you access to capital without having to put up collateral
Here is an example of when small business factoring could be helpful to your small business. Let’s say you have a client that is slow to pay an invoice. This is a loyal and longstanding client of yours, so you want to show your appreciation by keeping them on a longer payment term. Business factoring allows you to keep your loyal clients on longer payment terms without creating a funding gap.
Getting Started
One of the most important decisions that your small business will make concerning hard money loans and business factoring is knowing who to contact. A company like Thrive will give you the help that you need when it comes to business factoring and hard money.
