When exploring business loan options in Arizona, company owners are often surprised by the various types of financing they have access to. And for many company owners, it is especially surprising the benefits to be gained when going to an alternative lender.
Securing funding is the first step that must be taken when starting a business. And while many business owners will visit a local bank in hopes of getting a business loan, this type of lending comes with certain hurdles to overcome, especially when compared to going to an alternative lender.
Understanding the Benefits of Alternative Lending
There are many benefits to alternative lending. One of the primary benefits is that these types of lenders have a higher and faster approval rate, and secondly, they allow you to obtain funding in a shorter amount of time because they are an independent entity, resulting in a higher success rate.
When choosing to go with an alternative lender, borrowers will find that the lenders are more flexible in regards to qualifications that must be met. More so, when in need of financing for inventory purposes, alternative loans tend to be far more successful. In fact, most banks will not provide any type of financing for inventory. In addition, most alternative loans will not require the business owner to use his or her personal assets as a form of collateral for the financing; this not only increases a borrower’s confidence in being able to get approved, but it also adds to the personal security that the borrower is able to sustain in knowing they don’t have to put their personal assets on the line in order to secure a loan.
Credit Is Not an Issue
Another benefit of alternative financing is that when trying to obtain a business loan, your personal credit is not a factor. Unlike most banks, alternative lenders won’t dive deep into the borrower’s personal finances. Instead, they look at the merits of the company, not the borrower.
Save Time
Lastly, if you have ever applied for a loan at a bank before, then you know that the process can be arduous and lengthy, many times taking weeks to process. In fact, the actual loan application process can take upward of three months. By the time the bank is ready to fund your business loan, you may not need the money anymore. Or even worse, your business could be collapsing by the time the funding comes through.
The Takeaway
To maximize your business opportunities, especially in relation to time-sensitive matters like landing a new client, you should carefully consider the benefits to be gained by working with an alternative lender.
