How to Solve Your Common Credit Issues and Get Financed

By Sarah Wreschinsky
Jan 18 / 876 Views

When you have complications with your credit, finding ways to finance equipment can be difficult. Most banks won’t give you a second glance if your credit isn’t in their ideal range. This is problematic for business owners that can’t afford essential equipment without some financing help. Poor credit can leave a business lying stagnant if the owner doesn’t find a resolution in a timely manner.

Traditional financing isn’t always the best action in situations with quick turnarounds and not-so-ample credit. In these circumstances, a financing partner with flexible equipment financing options may hold the answer your business needs. Let’s look at some real-life common credit issues with tangible solutions, using a financing partner.

Credit Issue 1: Having recent losses

Even the best companies have difficult years. Often, those businesses that are growing the fastest have the most expenses and may show losses during a fiscal year. Many traditional lenders often have to tell long-standing clients that they can’t extend additional credit because of a recent hiccup in their performance.

“Find a program that looks at alternative credit criteria such as time-in-business, corporate and personal pay history, collateral values, and bank and trade references to make a credit decision.”

Solution

Quick application-only programs are often the best solution. Many don’t rely on a company’s past financial performance. You should try to find an application-only program that looks at alternative credit criteria such as time-in-business, corporate and personal pay history, collateral values, and bank and trade references to make an approval decision. So, even if you think you won’t be approved, completing a quick app like that is worth a shot. Chances are you’ll eventually find a financing partner that will help you get the equipment you need with no hassle.

Credit Issue 2: Waiting on revenue

With equipment prices at an all-time low, your business has the opportunity to take advantage of some great values. However, if your business is like most, you may be waiting to acquire the equipment you need pending an anticipated contract, large deal, or surge of revenue. As our economy improves and demand increases, the cost of equipment and financing will increase and those values will dissipate.

Solution

You can get your new equipment now and avoid paying until your business is bringing in more dough. Some financing partners give you the option to purchase now and pay later once your equipment, contract, or deal is producing revenue. Your business runs on this equipment, most lenders understand that.

credit issues, waiting for money

Credit Issue 3: Losing benefits by buying used  

Used equipment is plentiful in today’s marketplace. For the right type of buyer, used equipment represents a great value. Unfortunately, many businesses can’t take advantage of these opportunities due to financing restrictions placed on used equipment by traditional lenders.

Solution

Find a lender that understands your equipment like you do. Getting financing from someone who knows your business and what’s at stake from buying used equipment can give you peace of mind. With the time and mechanical expertise you have, get the quality equipment you deserve if used works for you.

Credit Issue 4: Stressing on your working capital

Slow paying clients, capital expenditures, and increasing fuel and supply costs all put stresses on a small business’ cash balances and working capital. Also new businesses, or businesses with challenged credit, may not be eligible for conventional bank financing.

Solution

Although traditional lenders and bankers may decline a business for having a less-than-perfect credit score, the right financing partner may see borrowing potential from a small business with a consistent daily revenue stream. Some companies that may have been considered too risky by other lenders could find financing for up to $200,000. The lender you’re looking for should be able to fund a small business based on its ability to pay rather than a score, which reflects the current economic environment instead of the value of a business.

To sum it all up

Most banks and traditional lenders aren’t swayed to finance businesses based on credit obstacles.  There are other solutions out there for your business when the textbook way to get funding isn’t an option.  Find a lender who can help with your next equipment purchase based on your business’ financial situation, even if that means you want to buy used or can’t pay upfront. Getting the equipment you need is important to you, discovering a flexible payment plan can help you get there.

  •  bank 
  •  buy now pay later 
  •  credit 
  •  credit score 
  •  finance 

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