Short-term financing has a variety of benefits that can provide a boost to your business. Keep reading to find out more about the upside of this financing option from alternative lenders.
Advantage 1: Emergency Funding
Short-term financing can be massively helpful during a financial emergency, as pointed out on Chron.com’s small business section. Even if your business has an emergency fund set aside, there’s always a chance a completely unforeseen event will drain your funds faster than expected. A short-term loan can help your business stay solvent long enough to make it through the rough patch.
Advantage 2: Quick Turnaround Times
Short-term financing is useful for situations like emergencies because these loans tend to have quick application processes. Borrowers typically only need to wait a few days for news on their approval, and in some cases, they may find out within hours. All in all, the less-stringent application process provided by alternative lenders can make the process of obtaining financing much less burdensome.
Advantage 3: Credit Isn’t as Important
If your business has less-than-stellar credit for any reason, short-term financing may still be available when other options aren’t. For instance, if your company hasn’t been in business long enough to build up a strong credit history, traditional loans may be out of reach through no fault of your own. However, alternative lenders do not judge shaky credit scores as harshly, meaning financing can still be obtained.
There are some factors you should keep in mind while pursuing short-term financing; for instance, the interest rate may be higher, and these loans often operate on a more aggressive payment schedule than traditional loans. However, if you need money in a hurry, it’s very hard to beat the advantages of this type of financing.
To keep learning about the world of business, check out Pendleton Commercial Financing’s other blog posts.