Can You Get A Loan For Your Business With Bad Credit?
Unfortunately, a lot of business owners here in the UK have a bad credit rating so, when it comes to seeking finance, it can present him or her with a problem in trying to source a lender. So, what are some of the options available?
Well, how poor your credit rating is may have an impact on your ability to obtain suitable finance. For instance, if you are a month behind in paying your credit card bill then that is not as bad in the eyes of a lender than if you had been declared bankrupt.
No doubt you will be looking to borrow the money as cheaply as possible i.e. paying a low interest rate. Such business loans usually tend to be available from the major banks and building societies as well as a variety of specialist lenders including peer-to-peer lenders. However, if your credit rating is such that you will not be able to obtain finance from such a lender then you may wish to consider other possible options.
There are a number of other lenders who specialize in providing fiancé to business owners with poor credit who will consider providing finance to help set up a business or assist an existing business but it is likely that such lending will cost more than if you borrowed the money from say one of the major high street banks i.e. you can expect to pay a higher rate of interest.
Another option to borrow money for your business is by way of a guarantor loan. This type of loan is provided to an individual who has a poor credit rating but is guaranteed by someone else who has a good credit history. The borrower will be required to prove to the lender that he or she can afford to meet the monthly repayments. In the event of the borrower being unable to meet the repayments then the lender could approach the guarantor and ask him or her to pay the repayments that have not been made.
If you have a bad credit history and are looking for finance for your business then why not get in touch with us and we can arrange for you to speak to a finance broker who may be able to assist.