alternative funding Archives - Excel Capital Management

Getting the funding you need for a home-based business can be challenging.

In addition to the challenges of starting a home-based business– applying for licenses, filing taxes– acquiring business capital to start, grow, or expand your business is a process all in itself. You may find you self asking your self how to get a loan for a home based business?

Many small companies usually start as home-based businesses. It is at this stage where the owner lays the foundation for their future business. It’s also the stage where owners face their biggest challenges.

Aside from getting clients, one of the biggest challenges for business owners is finding financing. Unfortunately, home-based businesses have few financing options. Many banks look down on this type of funding but we have some options for you.

That’s where home-based business loans comes in.

Fortunately, there are several programs available when it comes to home-based business financing, each with different advantages. Read on to find out more.

Obtain fast funding for your home-based business. Apply with Excel Capital: Apply Now

5 Home Based Business Loan Options

Home-based business loan options for small business owners.

1. Equipment Financing

Equipment financing helps business owners purchase any type of equipment needed to run the business.

The loan amount is dependent upon the type of equipment needed, as the repayment term is usually as long as the expected life of the piece of equipment and if it is used or new.

2. Split Funding / Merchant Cash Advance

Split funding, also referred to as a merchant cash advance, works on a “pay as you earn” model.

It is important to know that Split Funding is not a loan. Instead, a flat percentage of your business’ credit and debit sales are automatically debited daily and put towards the repayment of your loan.

If your business does a large amount of sales one day, a larger payment is taken out to pay back the advance. If a small amount of sales is done that particular day, you pay less. There is no fixed payment amount or maturity date. This type of funding is available only to businesses that accept credit card payments.

3. Short-term Loan

Short-term loans are used as a way to fill an immediate financial needs and fix cash flow issues.

Most lenders that provide this type of loan do not require a lot of paperwork and they can be used for virtually any business purpose.

Common uses of short-term business loans are inventory purchases, new hires and employee training, equipment repairs, and filling gaps between accounts payable and receivable. This financing solution mean shorter having a shorter repayment schedule with higher costs. Short-term business loans are generally paid back via weekly ACH payments.

In contrast, traditional term loans are paid back within a fixed term and a set interest rate. While traditional term loans allow you to build business credit and have fixed monthly payments, they come with less flexible terms and rates and penalties may be charged if the loan is paid off early.

4. ACH Loan

ACH loans typically require personal guarantees, and have a fixed repayment schedule that is paid either daily, weekly or monthly. They are a popular funding solution for businesses that do not accept credit cards or want a set repayment schedule.

Whether you need the working capital obtained through an ACH Business Loan for inventory purchases, new hires, employee training, purchasing equipment, or almost anything else for your business, this funding solution can be extremely beneficial.

Unlike traditional business loans, funds from an ACH Business Loan disburse in as little as three business days after being approved for funding.

Additionally, this funding product does not require a minimum credit score to qualify, which means many up and coming businesses or businesses experiencing a rough financial period. Having collateral is not necessary to qualify, so business owners who have poor credit or lack business history can still apply for this great funding solution.

5. Business Line of Credit

A business line of credit is a rotating loan, also known as a “LOC,” that gives business owners access to a fixed amount of money, which they can use day-to-day according to their need for cash. Interest is only paid on the amount of the advance actually used.

There are two types of Business Lines of Credit:

1. Unsecured Business Line of Credit

Unsecured business lines of credit do not require borrowers to pledge any assets as collateral.

As a result, this tends to be a more popular type of business credit line to business owners. However, they are much more risky for the lender, therefore your credit score must be excellent.

In addition, they tend to be smaller with higher interest rates.

2. Secured Business Line of Credit

A secured business line of credit requires business owners to put up assets as collateral in order to obtain the loan.

While lenders do not typically require business owners to pledge assets like property, they will require the collateral in the form of inventory, accounts receivables, and more. Consequently, if you are unable to pay back the loan, your lender will seize your collateral in order to pay the balance.

Both secured and unsecured business lines of credit will require your business to be in good standing.

Lenders typically prefer to work with businesses that are well-established and in good financial standing, thus proving to the ability to pay back the loan. Depending on the lender, various financial documents will be requested to support this.

Get the capital your home-based business needs. Apply for an unsecured business line of credit with Excel Capital: Apply Now

How to Get a Home-Based Business Loan: What Do you Need to Get Approved?

One of the benefits that come with alternative lending is a fast application and approval process.

Business owners don’t need to fill out or submit mounds of paperwork, or have to wait months to receive an approval or decline. Once a business has been approved, they can be funded in a little as a week.

The initial documentation is typically enough to get funding, but there are instances when additional documentation may be requested depending on the lender.

The following is the standard business documentation you should have prepared when starting the application process:

One-page application
Voided check (for your business account)
Copies of identification for all owners
Proof of ownership – Last filed Tax return , By laws for corporation or Articles of Organization for and LLC
Proof of EIN – If you do not have a tax return most funders can use a EIN letter or SS4 Letter along with proof of ownership
Three months of bank statements
Aging AR report if your in an industry where you have billing net 30-90

While not everything may be requested, the more the better here. Getting your documentation ready ahead of time will also speed up the time to fund, allowing you to get the capital you need ASAP.

Acquire a Home-Based Business Loan with Excel Capital

Finding funding for a home based business can be tough.

However, at Excel Capital, we strive to make obtaining funding easier and more convenient for small business owners in need of capital.

The application process is quick and, if approved, you could obtain funding in as little as 24-48 hours.

Click below to start your application:

Apply in minutes, get fast funding for your home-based business: Get Started

June is Lesbian, Gay, Bisexual, and Transgender Pride month each year in honor of the 1969 Stonewall riots, a major turning point in the U.S. Gay Liberation Movement, in Manhattan, NYC. Since those days, great strides have been made in terms of progressive thinking and equality. The LGBT community also makes up a large number of business owners in the United States.

As we know, most businesses will need to apply for some sort of working capital during their lifetime. Traditional loans are not always an option to many business owners due to the lengthy paperwork required and strict rules and guidelines, however, progress is being made when it comes to providing the LGBT community with business-funding options. For instance, the Small Business Administration (SBA) has set up a few different programs and outreach initiatives. Aside from the SBA and other traditional business loan options,

There are many alternative funding solutions that may be more suitable and easier for LGBT-owned businesses to obtain when it comes to growing their businesses. Here are a few options:

Merchant Cash Advance: Short-term financing transactions that are collected through a set percentage of your visa and mastercard sales that are accepted at your place of business. Probably the most common term used in the industry. These do not have a set repayment schedule and are based on the volume of your businesses credit card processing sales. These are usually only guaranteed by the future sales of your business.

Minority Business Loans: There are many options avaialable in this category and its not just catered to the LGBT community. We have put togher a full list of Minority Business Loan options available. Many of these are grants and offer zero interest funding programs.

ACH Loan Products: These are a bit different than cash advances as they are considered loans and may have personal guarantees. They have a fixed repayment schedule that is paid either daily, weekly or monthly. These products are catered to industries that do not accept credit cards and need a fixed payment.

Accounts Receivables Financing: This is one of the oldest forms of funding in history. This is used mainly when a business is due some sort of capital for work complete and is billed on a net 30, 60 or 90. for example, ABC Trucking delivered goods for xyz logistics but only receives payment from xyz logistics in 60 days. ABC can then factor the money due from XYZ at discount to receive the capital due in 60 days today.

Invoice Factoring: The purchase of accounts receivable for immediate cash.

Equipment Financing: A type of loan or extension of credit to a business, with the purpose of helping the business acquire new equipment. Equipment Financing Extends only the capital needed to purchase a specific piece of equipment and is most commonly written as a lease.

Business Lines of Credit: A rotating loan that gives business owners access to a fixed amount of money, which they can use day-to-day according to their need for cash. Interest is only paid on the amount of the advance actually used.

Start-Up Funding/Loan: A type of loan that provides a new business/company with sufficient upfront capital to get off the ground.

Asset Based Loans: A business loan secured by collateral.

SBA LOANs 504 Loans: The US Small Business Administration 504 Loan or Certified Development Company program is designed to provide financing for the purchase of fixed assets, which usually means real estate, buildings and machinery, at below market rates.

Term Loans: A loan that is backed by a bank for an exact amount that has a specified repayment timetable and interest rate that are adjusted accordingly. Terms mature between 1 and 10 years.

Excel Capital Management is a proud supporter of the LGBT community, and we are here to help with all of your business funding needs! For more information on Excel and the funding solutions we offer, APPLY NOW! For even faster service, contact one of our funding specialists TODAY at 877-880-8086.

How to Get a Home Based Business Loan: 5 Options