Are you starting a new business? Or are you planning to expand your services, but your credit score is preventing you from taking out a loan? Due to the lack of funds, some businesses are unable to move forward with all of their business plans.
Typical loans, including business loans, will request a hard inquiry on your credit record. This inquiry will affect your credit score. If you have bad credit, a credit check won’t do any good for you.
However, there are still business loans available where you can acquire cash for your business. Here are four types of business loans you can acquire that don’t require a credit check:
Working Capital Loan From Paypal
Paypal has become a very popular online payment processor. However, payment processing isn’t the only service Paypal provides. They also offer working capital loans, payroll loans, accounts payable, among other things.
The Paypal Working Capital Loan is the best option for you if you are already using Paypal as your primary form of payment, either in-store or online transactions. But if you don’t have a Paypal account, it’s best to visit their website first and create one for yourself.
Unlike conventional loans, working capital loans have fixed fees that are affordable. There are also no periodic interest fees, hidden charges, and no penalty charges if you choose this business loan option.
You’ll need to have a Paypal Premier or Business account for at least three months to be eligible for a Paypal working capital loan. A premier account owner should process $20,000 or more monthly, while a business account owner should process at least $15,000 monthly.
Merchant Cash Advance by First American
First American is offering a Merchant cash advance loan to help businesses acquire additional funding minus the extra credit checks. The merchant cash advance is created for business owners who want convenient and quick cash flow.
Before applying for a merchant cash advance, contact the lender as there are two types of merchant cash advance: a no-credit-check merchant cash advance and a credit check merchant cash advance.
To be eligible for the merchant cash advance, you should be in business for at least six months and have a gross monthly deposit not less than $10,000. Moreover, you should not have three or more insufficient funds events in your account per month.
This option is more favorable for business owners who want to grow their business. They can use the funds for renovations, expansion, or equipment upgrades, among other things. If you’re still establishing your business, choosing another option would be best.
Although the no-credit-check merchant cash advance won’t perform a credit check, they will execute a background check on their applicants to know if the borrower has the capability to repay the money they are going to borrow.
Invoice Factoring by BlueVine
The Invoice Factoring offered by BlueVine is another way to acquire a fast business loan without any credit check performed. This option is available only for corporations and not for sole proprietorships.
Invoice factoring fills the gap in your cash flow. This gap limits the operational cost that will hinder you from buying more inventory or hiring new employees. The Invoice Factoring of BlueVine will help you resolve your operational cost problem by providing you funds for your outstanding invoices.
Invoice Factoring allows you to use your outstanding invoice as leverage when applying for the loan. However, BlueVine is not 100% clear on no credit checks for loans, as they will perform a soft inquiry on your credit record. Unlike hard inquiry, a soft inquiry on your credit report will not affect your credit score.
Opening an account on BlueVine is free and quick. The process takes less than two minutes and can be conveniently done online. Simply create an account by providing all necessary information.
Your business should be operating a minimum of three months and generating an income of $10,000 and above monthly to qualify for invoice factoring. It is also required that you have a personal credit score of 530 and above.
American Express Business Loans
American Express offers an installment loan without any credit check being performed. However, only pre-approved business cardmembers are qualified to acquire the loan. This is the reason why they do not need to perform a credit check since all your credit information is already in their files.
This loan option will provide a specific amount of money that you will pay back over a set period in a regular payment schedule. American Express has a fixed annual percentage rate of 6.98% up to 19.97%, with a repayment term available of six, twelve, twenty-four, or thirty-six months.
Finding a conventional business loan that will not require a credit check is hard. However, nowadays, we are fortunate enough that there are more business loan options available, be it a cash advance loan or a working capital, that are accessible to entrepreneurs in need. These resources can greatly help business owners to cover expenses that are needed to keep their businesses up-and-running.
Check out my guide on how to start your business right with tons of useful tips I learned by successfully starting, building, and selling multiple companies.