Summary: The need to get quick money is high in case of startups and small businesses that seem to be always short of funds to operate. While traditional loans don’t provide the solution, there are many quick and easy loans that can help them get some fast cash.
Are you looking for a small business loan to run or expand your business? Not all small business loans have strict documentation requirements and stringent credit history. If you do some digging you can find easy and fast small business loans that can suffice your urgent cash needs. Here are 5 such loans to start with:
SBA Express Loan
A SBA Express loan can get you up to $350,000 of fast cash within 36 hours from the submittal of your application. Guaranteed 50 percent by the Small Business Administration, this loan carries lighter documentation requirement when compared to traditional loans. Even if the interest rate is higher than the traditional loan, it can’t exceed the 4.5 to 6.5 percent limit, since there is a cap. The repayment period is generally about 10 years for this loan and the amount can be used for any purpose other than paying back debts.
The lender might not ask you for collateral if your loan amount is less than $25,000; but for loans greater than that, there might be a collateral policy depending on the lender you choose. Also, there is a guarantee and servicing fee that the lender will have to pay to the SBA. So he might charge you these fees once he has paid the same. Nevertheless, it is important for you to find an SBA-approved lender if you want to apply for an SBA Express loan.
SBA Export Express Loan
If you are looking at exporting your products and need funds for the same, an SBA export express loan would be a good option. You can get up to $500,000 within 36 hours of applying for an SBA export express loan. It comes with a 90 percent guarantee from SBA if the loan amount is equal to or less than $350,000. For amounts more than that, the guaranteed percentage is 75.
Like an SBA express loan, the interest rate here is capped and is not supposed to go over and above the 4.5 to 6.5 percent limit. However, the proceeds of this loan can be used only to enhance the export development of a company. The terms with regard to collateral and the guarantee and servicing fee are the same as that of SBA express loan.
P2P (Peer-to-Peer) Loan
Unlike traditional loans and other non-conventional loans, there are no middlemen or financial institutions in case of P2P lending. There are online platforms that connect borrowers with individual investors. With each and every P2P loan divided among many investors, the risk is spread out. The origination fee and the interest rate that the borrower has to pay depends on the risk grade that he is assigned. Although the interest rates are higher in P2P loans, the eligibility requirements are less stringent and the approval rates are quite high when compared to the other types of loans. You can borrow up to $35,000 quickly. However, in some cases businesses do get to borrow up to $300,000 through P2P loans.
Microloan
If you are looking for a short-term loan at a low interest rate, microloan might be a better option for you. Micro lenders adopt a non-profit financing model and offer loans to help disadvantaged communities. The interest rate is 8.5 percent for loans less than $10,000 and 7.75 percent for loans more than that.
The SBA also offers microloan programs such as SBA community advantage program. Through these, businesses in communities with limited access to funding can get loans up to $250,000. However, the loan will have to be repaid typically within 40 months.
Business Lines of Credit
These work more or less like credit cards where you can get money without having to apply for a new loan every time. You can get a line of credit anywhere between $5000 and $150,000 within a period of 36 hours from applying. Once the maximum borrowing amount is approved, you can keep borrowing how much ever you want and keep making minimum payments. As in the case of a credit card, you will have to pay an interest on the money that you repay.
There is no restriction on what you can use your line of credit for. You can purchase equipment or inventory, open up a new branch, manage fluctuations from seasonal sales, or invest in marketing.
Apart from these options, there is also another source you can try, if you need some urgent cash to operate your business – a merchant cash advance provider. With the concept gaining popularity, many merchant cash advance providers have started contacting prospects through merchant cash advance leads.
Merchant cash advances are best for businesses such as restaurants and retail shops that make a sufficient amount of money through debit or credit card transactions. As long as you have the capacity to pay back the advance you have taken, it doesn’t matter even if you have bad credit.
Unlike other types of loans, there are no fixed monthly payments in case of a merchant cash advance. The repayment is easy and automatic. A certain portion of the revenue is automatically transferred to the merchant cash advance provider’s account every time you complete a debit or credit card transaction at your POS. Nevertheless, you might have to pay a high factor rate along with some fees while repaying a merchant cash advance provider. Make sure you read all the terms and conditions before signing up with any of the merchant cash advance providers whom you contact through merchant cash advance live transfer leads. It is better to be safe than sorry.
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