Thursday, 18 April 2013

How to Get Money to Start a Business When You Have Bad Credit

Know how to get money to start a business when you have bad credit.
Remember, it takes money to make money. Let's start with the commercial side of things.
Estimates suggest formal commercial lending covers about a quarter of the money to start a business. Two ways to utilize credit and bank loans efficiently:
  1. Apply for a debt consolidation loan: A goal for anyone with bad credit would be to take measures that improve your credit standing.
  2. Consider financing equipment, or leasing: Because the lender can take back the equipment, these types of loans are called secured. Personal credit histories are sometimes a lower priority for secured loans. Especially once you have consolidated your debt and made timely payments.
Micro-Credit may be an option if you don't mind the heavy interest. Try these:
  • .americaoneunsecured
  • .microenterpriseworks
Loans and government grants are a great option if you know how to find them. The interest is usually lower for loans, and grants are straight funding with no repayment requirements.
  • .count-me-in is a site targeting female business owners
  • Health-care businesses and technology companies are believed to more easily qualify for grant money.
Social Lending is exactly what the name implies. Be prepared to put your story out in the open for all to see
  • www.prosper.com
Look for social lenders with:
  • Business experience, especially in your industry
  • Ability to afford the investment
  • Lack of emotional baggage regarding your business

You will be required to build their trust in you.
Surprisingly, most funding comes from friends and family.
Again, look for lenders with:
  • Faith in your commitment and resolve
  • Business experience is a must if the above is lacking
  • The cash or credit needed
  • Lack of emotional baggage concerning you.
The smart, self-sustaining way to fund your business, and stay free of any outside financial entanglements is to: Generate start-up capital through effectively marketing a product. This will ensure that you are never helpless, and will always be able to generate income in any financial storm.
In the end, all you can do, no matter which direction you choose, is: Focus on your strengths Get help with your weaknesses. Start at the beginning, be sure to have a viable business plan.
Justin Michalski grew up in Pittsburgh Pa and currently resides on Maryland's Eastern Shore
His true passion is to empower other entrepreneurs and small business owners with the knowledge they need to market their product or service effectively and efficiently. "Work less, earn more," means working smarter, not harder.

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