There is nothing better than a fresh start and this is especially the case with businesses. When you are launching a new venture you need more than just enthusiasm to turn the dream into a reality. If you have struggled financially and ruined your credit score then there are limited choices available to you.
This is where you will require start up loans for small business with bad credit. You can become eligible for an affordable loan even with credit scores lower than 600. Listed below are a few start up loans for small business with bad credit you can apply for.
Accion Startup Loans
Accion offers medium-term loans to existing businesses as well as startups. The micro-lender accepts a minimum credit score of 575 or even 500 in some cases. The business has to have been in operation for at least six months and if it does not meet that requirement than it must be either a home based or incubator based start up with less than $500 in debt. No collateral is required for this start up loans for small business with bad credit other than a personal guarantee.
- Borrow up to: $10,000
- Repayment Period: 6 to 60 months
- APR: 9.5% to 33%
Kiva is a crowdfunding platform where you use peer-to-peer lending to get the required capital for the business. This is a type of start up loans for small business with bad credit where you need from 5 to 35 lenders from your own contacts or personal relations. After you have the social backing required to raise that amount the loan can go public.
- Borrow up to $10,000
- Repayment Period: 6 to 36 months
These type of start up loans for small business with bad credit operate on invoice factoring. This is a loan where a factoring company buys the account receivables of a company at a discounted rate. There is no minimum credit score or time in business requirement. The discount is usually 0.8% to 2% per months and the advance amount is 85% to 90% over a 1-year contract period. Invoice factoring is only applicable for financing certain types of businesses.