Is now the time to grow your business? The answer might be yes, so are you thinking of just getting a bank loan to help? Well that might not be as easy as you think. As you are ready to grow your business or take a risk, banks are not willing to do the same. As the economy has cratered banks are being extremely cautious when it comes to small or medium business loans.
When you stop and look at the reasons banks have cut their lending to small businesses, it makes sense. But, it is still frustrating that business owners are having to face so much rejection. That being said, small business owners need to learn to approach their loan search differently. It’s no longer about expecting the banks to give you credit; it’s about being aware of multiple ways to fund your business and preparing to try a few different sources.
Explore alternative lending
Instead of going to a bank, who will probably turn you down, another alternative is invoice factoring or asset based lending. Compared to small business loans, factoring often provides more cash per invoice and asset based lending which can provide working capital fast! Factoring is a type of financing in the form of purchasing and collecting accounts receivable (invoices) or of advancing cash on the basis of accounts receivable (invoices). Asset Based Lending refers to loans secured by a wide variety of assets such as accounts receivable, equipment, and inventory.
Benefits of Invoice Factoring
The most obvious benefit is that you get cash very quickly after a sale has been made. Being paid quickly for your products or services helps you avoid liquidity problems. It also makes it much easier to plan ahead, since you know exactly when your funds will arrive after each invoice is issued.
Invoice factoring can be an effective solution in the early days of operating a business or during those times of significant growth.
Benefits of Asset Based Lending
For asset rich companies, an asset-based loan may make more funds available because it is not based strictly on future cash flow predictions. Additionally, the structure often requires fewer agreements, providing more flexibility.
Many companies actually prefer Asset Based Lines of Credit to bank loans, even if they can qualify. Asset-based lending advance percentages are much higher than the bank offers, meaning you do not have to put up as much collateral to obtain the same amount of money.
Why Choose Third Coast Commercial Capital, Inc.
We offer our clients the flexibility of choosing which invoices they want to fund, and the convenience of doing business with a service oriented company. Our commitment to our customers is to offer the best possible service while supplying them with the working capital they need at a competitive price in order to grow their business.
We provide funding when you need it most… as often as you need it. We are dedicated to providing superior service, to ensure that your business is growing, and adapting to changing market conditions. To learn more about our services please call Third Coast Commercial Capital, Inc. today at 281.570.1850 or apply online and a specialist will get in touch with you right away.