Can I get a business loan with bad credit?

Finding funding for your business when you have bad credit can be extremely difficult. Bad credit limits the funding you have available, which of course can limit the growth of your business. So, can you get a business loan when you have bad credit? You can, but you have to take some steps, and work a little harder to get a business loan with bad credit.

First, order your credit report. You can't make sure you get a business loan with bad credit if you don't start by checking your credit and making sure there are no mistakes on it. You may not actually have "bad" credit; it could be "not good" but still good enough. Start by ordering your credit report and checking it line by line to insure that everything reported is correct. If there are any problems, make sure you correct them. Address them immediately and make sure they are accurate. Look at your report and see if you have any R9's. If there are not any R9's you should be able to get some kind of credit. If you do have R9's, make sure that you explain them to your lender. If you can't explain them to a lender, you won't be able to get a business loan.

Next, determine if you have collateral. Collateral can be a big help if you want to get a business loan with bad credit, as it offers leverage for your debts. If you have bad credit, and want to get a business loan, then collateral is something you can't do without.Collateral can include machinery, real estate, inventory, vehicles, cash, etc. If you have bad credit, providing collateral to your lender will mean offering some reassurance to the lender, and reduce the risk that they might consider you as being. Collateral means if you default on your loan, they have something to collect to minimize their losses.

Last, but not least, if you want to get a business loan with bad credit, you have to have a killer business plan. Bad personal credit is going to damage your chances of getting a loan, so you have to be able to show the lender that you are still worth a loan, despite your bad credit. This comes in the form of a business plan that is bulletproof. Tell your lender why you are qualified to work in the industry. Make sure you highlight your competitive advantages, and that you know and understand your competitors. You have to show your lender how you plan to take your competitor's market share, or at the very least keep your own. You can't assume anything, instead, you have to tell your banker everything, such as what your industry is, and spell out your plans to conquer it.