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alternative lending

Home Based Business Loans

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Home Based Business Loans | Excel Capital Management

Getting the funding you need for your business can be challenging. This can be especially true for a home based business.In addition to the tedious process of starting a home-based business, applying for licenses, filing taxes and much, much more, acquiring capital to start, grow, or expand the company is a process all in itself. 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 the right type of financing. Unfortunately, home-based businesses have few financing options. Most don’t have the assets or the track record needed to qualify for conventional bank financing. Instead, they must look for alternate and specialized options. Unfortunately, federal agencies cannot provide home-based businesses with grants, however, there are feasible programs available when it comes to financing.  Let’s take a closer look at what’s available.

Home Based Business Financing Options

wealth | excel capital management

Equipment Financing help 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.

Split Funding also known as 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.

Short-Term Loans are uses 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.

ACH Loan: These loans may need 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.

Business Lines of Credit: 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:


 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, Unsecured Business Lines of Credit tend to be smaller with higher interest rates.

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.

 

The Application Process  

business capital application | Excel Capital ManagementOne 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. Usually, the documentation that is initially submitted is enough for this to happen in most cases, 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:

– Business license

– One page application

– Voided check for the business account

– Clear copies of identification for all owners

– Proof of ownership

                                                                                                                                      – Trade references

                                                                                                                                      – Four months of bank statements

                                                                                                                                      – Four months of credit card statements (if applicable)

 

Finding funding for a home based business can be tough, but luckily there are financial options in reach! For more information on the alternative financing solutions Excel Capital Management offers, call 877-880-8086 to speak to one of our Financial Specialists.

Construction Business Loans: Get the Funding Your Construction Business Needs – Now!

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EXCELCAPITAL - CONSTRUCTION BUSINESS LOANS

Construction Business Loans – Everything You Need to Know

As a  General contractor, you know that obtaining construction business loans is important to keep your business moving and operating in a fluid fashion. Construction businesses are not like a  traditional brick and mortar business when it comes to cash flow cycles. Most payments do not come until at least 90 days after the project start date which makes loans for construction companies a necessity.

Most contractors do not get paid in full when they sell their product. As a contractor, you know that selling the job or winning the bid for a project is just the beginning of a long cycle of payments. When a new job is taken on many contractors receive a small down payment upfront and receive progress payments or tiered payments as the job hits certain milestones. This delayed payment structure makes obtaining construction business loans crucial to maintain positive cash flow. 

What happens until the milestone gets met and how this affects cash flow?

Many contractors need to come out of pocket for many expenses like 

  • Payroll
  • Material Costs
  • Insurance
  • Equipment 

These expenses are crucial to keep your operations in order while completing the Job. 

Why Take Out Construction Business Loans Instead of Going to Your Local bank?

The main reason is timing – Most bank Just take too long! When you go to a bank most closings don’t happen overnight. 

Even if you try to avoid the timing issue by planning when you need it with the local bank many contractors that apply for a construction business loan with the local bank find out that without pledging collateral banks will more often then not decline a construction business loan due to contractors being placed in a high-risk bracket when it comes to traditional underwriting for construction business loans. At excel we understanding contractor loans. We worked with hundreds of contractors.

 

Why do Banks Decline Construction Business Loans?

There are a few reasons… 

Primarily Four:

Most contracts do not have collateral 

Construction is considered a  high-risk industry by most banks

Bad Credit

Receivables are not for work complete but rather for progress made on a job thats in process. Therefore receivables can not be factored. 

However,  in the event that collateral and stellar business credit are present the application and approval process for a construction business loan can be very long and tedious. With underwriting times often taking as long as  3 months.  When it comes to lending to contractors we understand how it can be frustrating to get approved for funding.  That why we approve contractors in under 48 hours generally.

*For more information on common reasons why your business loan application might be declined, read: 3 Reasons Why Business Loan Applications Get Declined By Traditional Lenders and Alternative Financing Solutions.

But there’s good news– there are now many alternative non-bank lending options available when it comes down to lending for contractors which can be used to obtain the funding your construction business needs, whether it be for:

  • New equipment
  • materials purchases for an upcoming Job
  • Payroll costs and new hires
  • Paying bills
  • Bidding on new jobs
  • Past due business taxes
  • Past Due Invoices

Whatever you need funding for, there are alternative lending options available to you which can get you the funds your construction business needs.

At Excel we have over a 90% approval rate when it comes down to lending to contractors since we have a specialty platform dedicated to underwriting construction business loans. 

Construction business loans the alternative options:

So, what are your options?

Well, you’ve got a lot. And it all comes down to what you need the funds for.

As mentioned above, no matter what you need funding for, there are several options available for you. However, some loan options are designed for specific needs while others are more general.

Equipment Financing

Equipment financing is used to help you purchase whatever equipment your business needs to run smoothly.

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.

Invoice Factoring

Invoice factoring is used for short-term cash flow issues, especially when your business doesn’t qualify for a traditional bank loan or any other alternative solution.

The lender will factor your business’ customer’s invoices to match your working capital needs.

This type of program is rarely used for contractors since progress payments cannot be factored. Factoring companies only use invoices for work complete. In the construction business, it typically happens this way.

Unsecured Business Loans

This Program was designed for business owners to enjoy the benefits of a Merchant Cash Advance who do not accept credit cards at there business. Most contractors do not receive credit card payments – and even if they do its typically a very small percentage of the annual gross sales.

This works as a purchase of future sale at a discount that is converted into a set payment. This payment is remitted via ACH usually daily, weekly or monthly. 

This allows you to get construction business loans without any collateral just your sales.

Merchant Cash Advance

For those of you who accept credit cards at your business – Split funding, or a merchant cash advance, is a construction business loan based on a purchase of your future credit card sales at a discount.

Payments are collected at a set percentage of your credit card sales, which is nice because that means when business is down– so are your payments. And when there is no business– no percentage.

For that reason, this method really helps during a particularly volatile market or rough patch in your construction business.

Term Loans

Our fourth construction business loan option, term loans have a set repayment schedule and interest rate and mature between 1 to 10 years depending on the term of the loan.

However, keep in mind that this type of loan requires financial statements as well as 2 years of business history and one filed tax return.

Business Lines of Credit

A business line of credit is a rotating line of credit which you can dip into whenever the business needs it most.

Similar to a credit card, so long as you pay off your balance you can continue to use that line of credit continuously. Interest is then only paid off the amount that is used.

Asset-based Lending

Lastly, with asset-based lending, the assets of a business, such as inventory, accounts receivable, and other balance-sheet assets are used as collateral.

Plus, because this financing type is secured with collateral, interest rates tend to be low. Having applicable collateral also makes an asset-based loan easier to obtain.

What do I need to obtain a construction business loan?

Although alternative lender’s guidelines are not as strict as traditional bank and lending institution guidelines, they still take your credit score– and several other factors– into consideration when determining your eligibility.

For that reason, it’s important to know what those critical factors are so you can put yourself in the best position to be presented with an approval.

These are the “4 C’s of obtaining a business loan”:

Collateral

Typically, collateral comes in the form of property or liquid assets which are offered as a form of insurance in case you ever can’t pay the loan back. This is what people have come to be used to with bank loans, which are secured due to that collateral. Banks generally require collateral for construction business loans so be prepared.

However, alternative lenders are unsecured, meaning alternative lenders don’t typically take collateral as security for the loan.

Most Fintech, or alternative lending, products are only collateralized by your receivables and limited to business-related collateral, not personal.

Cash flow

The second ‘C’, cash flow is a critically important factor when applying for a loan.

Lenders like to see a healthy average ledger balance in the business account. And, if there are many returned or insufficient items in the account, lenders will often be reluctant to extend credit.

Capacity

Capacity refers to a track record of being able (or not) to make the revenue needed to pay back your loans.

This can be in the form of copies of contract invoices or a copy of your accounts receivable report.

Character

Lastly, the final ‘C’ character is determined by taking a look at the borrower’s personal credit history.

Some of the factors taken into account here are your total debt, delinquent accounts, available credit, and whether you’re making payments on time.

Keep in mind that even if you don’t satisfy each of the above factors, there are several other factors which alternative lenders take into consideration during the approval process.

But this is just one of the many benefits of alternative lending.

Why alternative lending?

In recent years, the way that banks lend money has changed.

It’s now far harder to obtain construction business loans or any type of loans for construction companies than it ever was before and the application and approval process is tedious and time wasting.

However, now alternative lenders have afforded business owners and contractors the chance to get the funding their business needs without having to jump through insane (and, frankly, outdated) hoops to get it.

Alternative lenders us more sophisticated algorithms for deciding the health of your business, taking into account much more than just your credit score (so don’t worry if you don’t have stellar credit), making it easier than ever to get the funding your construction business needs.

But the benefits of alternative lending don’t stop there:

  • There’s often no personal collateral or guarantee required
  • Minimum paperwork
  • Poor credit accepted
  • Repayment terms are flexible
  • Fast processing
  • No application fees
  • Builds your business credit
  • Funding in as little as 2 business days
  •  

How to obtain construction business loans

Ultimately, it’s up to you to do your research and find out what your best options are.

It’s your business and no one is going to look out for it like you will, so take the necessary steps to educate yourself and then take action to obtain the funding your business needs, whether that’s to keep things afloat or to take things to a whole new level.

Whatever the case, don’t let a lack of funding hold your business back from realizing it’s potential.

To apply for a construction business loan with Excel Capital, only four things are required:

  1. Four months of recent business bank statements
  2. Four months of business credit card processing statements
  3. A one-page application
  4. And just a few minutes to get started

We’ve made the process simple and straightforward so you can get back to what is most important– running your business.

Once everything is received, you can be presented with an approval and funded in as little as one business day– that’s right, just 24 hours.

Get the funding your contracting business needs by completing our short, 2-minute application.

We are experts in construction business loans – See the Excel difference for yourself.

Construction Business Loans – A Case Study

While the construction business is one of the oldest, most flourishing, and most competitive industries around, there comes a time when many of its business owners need access to working capital. The cost of equipment, materials, payroll, and slow turn-around rates trump the cash flow coming in, and many construction company owners find themselves weighed down by bills and overhead costs. Since the great recession of 2008, a traditional bank loan is no longer the go-to solution when it comes to acquiring capital. That old-school way of doing things sometimes ends in heartbreak due to waiting weeks just to receive an answer. That’s where the alternative financing industry comes into play!

With financing solutions such as the ever-popular Merchant Cash Advance, ACH Loan, Asset Based Loans, Equipment Financing, and more, access to working capital is easier than ever! There is no longer a stigma with taking a loan or any type of financing. Working capital is essential when it comes to growing a company of any kind, especially a construction company. Due to the cost of machines and equipment sometimes reaching well into hundreds of thousands of dollars, or the burden imposed by having contractors absorb the upfront costs when starting a job – such as the cost of construction materials like granite and wood – and not to mention, insurance costs and payroll for workers and employees, construction company owners should expect to reach out for capital at some point in their business’s lifetime. Some companies choose to do this more than once, and why not? If working capital is increasing your cash flow and allowing you to take on more jobs, it only makes sense to ask for more. Afterall, the goal most of us strive for is to ensure steady work flow and income for years to come.  

Recently, Marty, a construction company owner from Georgia reached out to my company, Excel Capital Management. Marty was in a crunch and in need of funds, and he needed them fast! With a handful of projects on his plate, along with receivables due to a form on a large ongoing project  not being paid on schedule, Marty asked us for working capital to be used towards the purchase of materials, construction equipment, licensing for projects to be completed, and payroll.  As you know, only a small fraction of projects pay upfront and most only payout in tranches after certain milestones are hit at. When workers and office employees expect to be paid, and materials need to be purchased, waiting for these payouts is not an option. In order to get things back on track, as well as to generate new growth, Marty asked our sales rep, Jordan Lindenbaum, for help in securing an ACH Loan Product – a short term funding product  paid on a daily or weekly basis by direct Automated Clearing House debits.

Marty’s situation was a tough one! He was owed close to $200,000 which was tied up and not coming in for at least thirty days, plus around $150,000 in retainage for completed contracts,  however, that was going to be payed out over six months. He also had both a  $2 million and a $1.5 million contract on the table respectively (both carrying a 20% gross profit), but those were not set in stone. Marty’s company had no time to wait with other projects lined up and needing to be completed by early 2016, however, they couldn’t be completed unless he had the means to hire more workers and purchase a few machines to keep up with the timelines in place. Obviously, without the aforementioned payouts, he was in a bind. To the Average Joe, these type of accounts receivable amounts seem amazing, but in the construction business, we know this revenue doesn’t always reflect the tangible finances. Most, if of not all, of the money is put back into the company to complete ongoing projects. Whether Marty could wait until his pay day or not – he needed some additional working capital, now.

After supplying us with a few bank statements, a business lease, his driver’s license, and a few other minimal stipulations, we were able to get Marty $80,000 in working capital in a matter of only two days! The daily repayment amount was only $400 per day – an ACH automatically debited (so Marty wouldn’t have to worry about making any large monthly payments – he could focus on his projects at hand) which would happen over the course of 12 months. It was as simple as that! No hassles or phone calls from banks, just a solid relationship with an alternative financing company, such as Excel Capital Management, and peace of mind.

Everyone needs a little help here and there, and there is no shame in asking for it. There’s more hope than ever for small to mid-sized businesses when it comes to acquiring working capital. Whether you need $5,000 or $5,000,000, there are options. Most of today’s top CEOs have taken loans or received working capital in order to grow their companies into multi million dollar corporations. You know the old saying. “It takes money to make money!” With our state of the art approval process loans for construction companies are one click away.

3 Reasons Why Applications For Business Loan Get Declined

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3 Reasons Why Business Loan Applications Get Declined By Traditional Lenders and Alternative Financing Solutions

Almost all business owners apply for some sort of financing to grow their company at one point or another. When it comes to applying for for this financing through a traditional bank or lender, the process can be a tough one, and many business owners walk away with a big fat decline. While this may be disheartening, there are many reasons why business loan applications get declined and lenders are so strict, and there are still other options out there. Let’s take a look at the three main reasons why business loan applications get declined by traditional banks and lenders, and then take a look at the great alternatives that are available!

Why Traditional Lenders Decline Business Loan Applications:

  • Low Cash Flow: If a traditional lender decides to give your business a loan, they will want to see the ability to make payments back on the loan amount in addition to covering all other business expenses. Unfortunately, tough times do occur where businesses don’t generate enough revenue at certain times of the year – maybe they are a seasonal business. Some business owners, such as contractors, aren’t paid until jobs are completed or they must pay inventory suppliers upfront before they get paid. Tight margins typically do not sit well with traditional lenders and you could get your business loan declined.
  • Poor Credit, Bad Credit, or No Credit: Like NorthShore Advisory Inc. Credit Expert Tracy Becker told us in our exclusive interview, “in today’s fast-paced business world, more partners, lenders, and potential accounts need to make quick decisions as to which suppliers, borrowers, and partners they want to work with; decision-makers use a variety of business credit scores, indexes, and reports to discard unqualified candidates from being considered for a partnership or a loan.” A business’ credit score is a major factor when a traditional lender considers approving them for financing. Poor credit, bad credit, or simply no credit can almost always guarantee a decline. To learn more about how businesses can improve their credit score, visit: http://www.northshoreadvisory.com/
  • No Collateral: Traditional banks and lenders almost always require some sort of collateral to secure a loan. Collateral can come in the form of a vehicle, personal or business property, equipment, and/or other assets. If a business owner defaults on the loan, this collateral will then be seized for nonpayment. Unfortunately, many business owners (especially young business owners or startups) do not have collateral to put up when it comes to acquiring a loan, or the lender may not deem anything the business owner has as anything of value.

Your Business Loan Application Got Declined By A Traditional Lender – What Are The Alternatives?

Despite the fact that traditional lenders can take weeks to process your loan application and also require a lot of paperwork, there are alternative financing solutions available if you got your business loan declined. Unlike big banks, alternative lenders typically only require you to submit a simple, one-page application, 4 months of recent bank statements, and 4 months of recent credit card processing statements in order to get an offer and approval in a matter of days! Let’s take a closer look at the alternative funding solutions available to your business so even if your business loan was declined your options are open!

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 business’s credit card processing sales. These are usually only guaranteed by the future sales of your business.

ACH Advance: A form of a merchant cash advance that is repaid on a daily basis by direct ACH debits rather than a merchant account.   These are still a purchase of receivables and the amount debited via ach are determined by the amount of credit card processing sales that are batched out the previous day.

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.

It’s pretty clear to see why an alternative lender may be the way to go when it comes to applying for financing for your business. No complicated application process, no lengthy paperwork and documents, and an approval in as little as 3 business days! For more information on alternative financing solutions and what Excel Capital Management can offer your business, visit: https://www.excelcapmanagement.com/loan-form/

The Excel Interview With deBanked’s, Sean Murray

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Debanked

Merchant Cash Advance industry veteran, founder of deBanked, Sean Murray has been an influential part in funding over $100 million to small businesses through sales and underwriting efforts. As a Senior Account Executive at Bizfi (part of the Merchant Cash and Capital family), he grew one of the largest residual portfolios in the history of the company and become a well-respected expert in the industry. After his time at Bizfi, Murray founded Raharney Capital, providing advertising and consulting within the alternative lending industry, and also deBanked – the most popular magazine and resource in the industry where Murray also serves as the Editor-in-Chief. Excel Capital Management recently sat down with Mr. Murray to explore his vast knowledge of the Merchant Cash Advance and alternative finance industry and discuss the future of the business.

deBanked sean murray

Excel: Tell us a little more about your background and what made you get into the alternative finance industry.

Sean: I got into this industry almost immediately after college. That was 10 years ago. A friend of mine told me there was an opportunity to work at a fun financial startup. The job description entailed evaluating small businesses for working capital, ones that had mainly been declined already for a bank loan. Given that I double-majored in Accounting and Finance, I was definitely intrigued and took the job.


Excel: You’ve been in this niche industry for quite some time. Over the years, how have you seen the industry change and grow?

Sean: In the beginning, the worst part for the small business owners I spoke to was that approval terms were tied entirely to their average monthly credit card processing volume. That meant if cash sales were 90% of their business, we couldn’t consider that, even if that cash was showing up in their bank statements and being declared on their tax return. Over time, funding providers became more creative and flexible. They found ways to better service clients without making it impossibly hard to qualify.

Excel: Did you ever expect the industry to become as popular and as competitive as it is?

Sean: Yes and no. Given that I started before the Great Recession, there was already a big need for non-bank alternatives. The industry already existed and was growing. It wasn’t a byproduct of an economic downturn, it just became more visible during one. People think that when the economy fully heals, that banks will start lending again and the non-bank alternatives will disappear. The truth is that banks never serviced this segment of small businesses. It was and remains to be too expensive, risky, and time consuming for them to underwrite a $20,000 business loan. Sure, they’ll issue you a business credit card, but that’s based on your personal credit, is personally guaranteed, and more often than not the limit is too low. So no, I am not surprised that the industry has become so popular but I am surprised the product mix available to business owners has diversified as much as it has. It’s truly incredible.

sean murray interview
Excel: In the latest issue of your publication, deBanked, you provide a few predictions on the future of the industry. You specifically mention the fact that it is an election year and touch base on the current state of the stock market. Can you elaborate on these topics and how they relate to the industry?  Also, speaking of the election, Democratic candidate Bernie Sanders has stated that he will impose nationwide interest rate caps that would, in the long run, hurt marketplace lenders. What are your thoughts on this?

Sean: I think what I was trying to say was that a new President sets the regulatory and legislative “tone.” This year we have a colorful group of candidates, many of whom have big ideas on how to grow the economy. Bernie Sanders in particular has made some pretty controversial statements, one being that he is in favor of a 15% federal interest rate cap on consumer loans. I think many people when they hear that, assume that would mean that a lender that normally offered a borrower a 28% interest rate loan would instead offer a 15% interest rate loan to comply with the cap. That’s not what would happen at all. Instead the lender would just decline the application. In effect, a huge portion of the population would not be able to get a loan from anywhere, not even non-bank alternatives. You know the saying, “it takes money to make money?” That goes hand in hand  with the “rich get richer while the poor get poorer.” Borrowing can be used as leverage to grow and in essence become richer. It takes money to make money. If you’re locked out from borrowing, supposedly for your own good, how do you become richer if your risk profile makes it legally impossible to take money and make money? That’s obviously a larger debate but it all feeds back into the upcoming election and who will be running the country. What will their economic views be? And will that “tone” positively or negatively affect small businesses? Nobody likes the uncertainty in the meantime.

As for the stock market, the connections are easy. Declining stocks increases the allure of investing on peer-to-peer platforms where the returns are perceived as both steady and rather lucrative. It can be hard to stomach a 10% loss in your investment portfolio in a matter of weeks like the stock market did in the beginning of this year. Investors, even small retail investors are going to consider alternatives like this industry. A declining stock market also chips away at wealth and this can affect consumer buying behavior which would impact small businesses. It’s all related at the end of the day.

Excel: Along the same lines, what are your the thoughts on the alternative finance industry being regulated? Do you see this happening anytime soon? If so, how will these regulations affect business?

Sean: I think regulation, if any, will focus on disclosure and transparency. If this is indeed where it goes, I just hope the outcome is intelligent, well thought out and logical. It’s early days right now though so it’s hard to speculate. In business-to-business transactions such as the kind your company engages in, I’m a big believer in the invisible hand. It’s commercial finance, not consumer finance. Some of these businesses might be really small, but we’re still for the most part talking about corporations entering into contracts with other corporations. I think regulations should focus on consumer lending, where there is a much lower presumption of sophistication.

Excel: Moving forward, what impact do you believe the collaboration between OnDeck and Chase will have on the industry as whole?

Sean: From what I know about the partnership and from what I know about banks, I believe Chase is probably using this as an opportunity to fast track their online loan underwriting process while they figure out a longer term technological strategy. You have to remember, it’s not uncommon for banks to be using really old systems. I believe some are still using or have just moved away from Windows XP recently. That’s a 15 year old operating system. Between that, constant bank mergers where the acquired banks are using completely different systems, regulations, and the sheer size from a human resources perspective, all make it nearly impossible to catch up, let alone implement a modern underwriting platform that measures 10,000 data points with connections through all sorts of APIs. The easy solution for now is to use a company that can reliably provide that capability and I think it’s great that OnDeck’s platform instills a level of confidence that a famous bank like Chase would attach their brand to. I think OnDeck and others will score more of these partnerships and there is potentially a play for one to be ultimately acquired by a bank just for the technology.

Excel: As this industry continues to grow and more people are entering the market, what is one piece of advice you can share about the do’s and dont’s of our marketplace?

Sean: Do be responsible and act with integrity at all times. Don’t think you are too small or insignificant to make a difference. If you only help fund one small business and they hire new people as a result, there’s a chain reaction that occurs that affects the entire local economy. It’s a beautiful thing to play a role in that.

Unsecured Business Loans: How They Work, Rates, and How to Qualify For 2020

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Unsecured business funding: at a glance

When it comes to acquiring a business loan from a traditional bank, many business owners find themselves in a sticky situation due to heavy requirements and long time frames to funding. Unsecured business funding was created to avoid these common issues with traditional business loans and make quick, small business loans possible.

How does an unsecured business loan work?

Unlike secured or traditional bank loans, unsecured business loans don’t require collateral or a personal guarantee . Approvals are based on your revenue and cash flow.

How to qualify for an unsecured business loan

Get your funding options with : Complete application 3 months of banks statements

bad credit – and all industries are accepted. Requirements: 6 months in business and $10,000 in monthly sales

What is an unsecured business loan good for?

Uses typically include :

  • Working Capital
  • New Hires
  • Expansion
  • Inventory
  • Payroll
  • And Much More!

Most banks will only approve you for a loan if your business is at least two years old and only if the loan is secured and you can show positive cash flow and profit on your tax return.

In other words, you have a positive debt service coverage ratio that can service the loan on paper.

Most business owners under 2 years in business show a loss. From our experience over 70% of business owners, less than 2 years don’t show a profit due to startup costs and investments.

This means that if the business owner fails to make a payment or goes into default, the bank can seize collateral such as business property, equipment, cash savings and deposits, and even personal assets.

In addition, your business needs to have great to excellent credit. You can see how this can be problematic for new businesses.

Many business owners have no collateral or low credit scores (often both) and look for no collateral business loans to finance their working capital needs. So, what do you do? That’s where unsecured business loans can be invaluable.

With no personal guarantees or collateral required as well as funding (and approval) in as little as 24 hours, an unsecured small business loan with Excel Capital can give your business the funds it needs to move forward in times of expansion– or stay afloat when your business is in need of cash.

Complete our online application and see how much you can be approved for: Apply Now

With that said, below, we’ll cover everything you need to know about unsecured business loans.

First, let’s jump into the different types of unsecured business loans so you know what your options are.

What are the different types of business loans?

Unsecured Business Loans

Receive a sum equal to a portion of credit card sales. Advance is repaid as a percentage or “split” of credit card sales.

Split Funding

Gives you the ability to draw down on capital as you desire, allowing you to reuse provided you repay your balance.

Unsecured Business Line of Credit

Designed to fill immediate, short-term needs or cash flow issues. Predetermined payment schedules and amounts

Term Loan

Lender purchases a set of future sales, sold by your, the business owner, at a discount.

Revenue-based Factoring

As you may already be aware, there are primarily two types of business loans which are as follows:

  • secured business loansSecured Business Loans
  • secured business loansUnsecured Business Loans

Today we will dig deeper into the different types of unsecured business funding options and help you choose the best small business loan program for you.

When deciding what type of business funding is the right choice for your particular situation you have to analyze your options deeper than just asking yourself “what do business loans cost”?

When you have already made up your mind about business funding and committed to the fact that acquiring working capital is necessary to take it to the next step for your business you have two broad options to think about unsecured business loans or secured business loans, which one is the right choice for you?

In general, it seems pretty obvious what the difference between a secured business loan and unsecured business loans is, right?

One asks for collateral and the other does not  while that logic seems to be correct at face it more value most business owners need to understand that there are a variety of options available in both categories of funding (not just loans) and that there are a variety of business assets you can leverage to avoid having to pledge physical collateral or a commit to a personal guarantee to raise capital for your business.  

We have decided to put together a quick guide exploring a variety of different unsecured no collateral business loans and other funding products. So you can determine what type of funding is the best choice for you.

We will aim to explain the differences between each type of products and what kind of security interest or guarantee they may have attached to it.

We have all heard about unsecured business funding as a business owner but what does that really mean “unsecured” and what types of unsecured small business loans are available?

First, we’ll start by telling you what it doesn’t mean: it doesn’t mean that if you decide to wake up one day and say “I don’t want to pay my funding back just because the sky is blue” you are free and clear of your credit obligations.

What this refers to, depending on the type of funding, is either a removal of a personal guarantee or a removal of personal and most business assets, in the case of the inability to repay. What this serves to do is create a veil between your personal or physical assets and the credit obligations you make in the business world.

All unsecured business loans use your receivables as collateral which means if you stop having receivables (or money that is collected from sales and services) than technically the security interest in your receivables is worthless since you have no more receivables. That is why the rate can be higher than secured loans.

Additionally, most of these options will not require a first position lien filing on anything related to the business meaning the funding received is the last to be collected in case of a bankruptcy or liquidation.

Split Funding (also known as a Merchant Cash Advance)

Split Funding

*Also referred to as Merchant Cash Advance

Best for: Business owners who accept credit cards

  • Loan amount: $5,000 – $500,000
  • Repayment terms: 3 – 18 months
  • Minimum credit score: No minimum
  • Additional minimum requirements: $100,000 annual revenue, 6 months in business
  • Speed: Approval in 24 hours, funding in 2 – 3 business days

When explaining a merchant cash advance we like to call it split funding because literally what it means is, we apply a split to your receivables until the funding is paid in full.

The specifics of the split or percentage held back of your Visa and Master Card and other credit card processing volume is based on the contract that is agreed upon prior to getting funded and is generally underwritten based on your credit card processing volume coupled with your gross monthly revenue deposited into your business bank account.

Many business owners at first are confused by this concept and what this means but we will aim to simplify the definition of a merchant cash advance and the mechanisms used to collect this type of funding product.

All merchant cash advances utilize your future credit card sales to calculate the repayment pace of the advance and there are 3 ways to provide this type of unsecured business funding.

1. Merchant Cash Advance A Direct Split with Your Credit Card Process Provider

This is the most seamless type of merchant cash advance. All this means is we utilize one of our friendly credit card processors (click here for a list) to divert the agreed-upon percentage to us and applied to the outstanding balance whilst you receive the remainder of the credit card processing sales directly in your existing bank account like you normally did before receiving the business funding.

This split happens every time you batch out your terminal and you receive no delay in deposits and you repay at the pace of your business. This requires your process allow us to place as split on your credit cards sales. The beauty of a direct split is that it gives a funding option to business owners who have a high amount of NSF’s (non-sufficient funds) or overdrafts or have a very volatile sales cycle.

2. Lockbox Funding

This method is utilized when a business does not use one of our friendly credit processors and does not want to switch their existing merchant processing provider to facilitate the funding.

A lockbox is good because many merchant processors have early termination fee’s and this avoids paying them to get split funding. How a lockbox works is a bit more complex than a direct split on your credit card processor. We set up a lockbox account also known as a bridge account or you. This bridge account is an actual bank account where you receive online login credentials and a bank letter.

This account is solely used for splitting your credit batches between the funding institution and your business account. Once a batch is received into that account it is designed to automatically ACH the specified percentage to the corresponding accounts.

Due to the process associated with this type of funding, there is typically a 24–48-hour delay in the time it takes the money from your batch to hit your business bank account.

In order to set up a lockbox you need to follow these 3 steps:

  • Sign the lockbox form provided on the funding agreement authorizing the lockbox account
  • Receive the bank letter created upon receipt of the lockbox form.
  • Call your credit card provider and tell them you want to switch where your credit card processing activity is being deposited.

Usually, they can do this over the phone, online or will ask you to complete and sign a bank change form and have it return to them via email or fax which will require you to attach the copy of the bank letter to the executed bank change form.

This can take up to 48 hours depending on your credit card processor.

3. Variable ACH

These cases are perfectly simple and easy to distinguish. In a free hour, when our power of choice is untrammeled and when nothing prevents our being able to do what we like best, every pleasure is to be welcomed and every pain avoided. But in certain circumstances and owing to the claims of duty or the obligations of business it will frequently occur that pleasures have to be repudiated and annoyances accepted.

This mechanism is used to collect payments when a business owner does not work with a “friendly” merchant processor and does not want to incur the 24–48-hour delay in deposits. The way this works is pretty straightforward.

Our collections department logs into your merchant processing portal on a daily basis to see what the last batch was and then collects the specified percentage via ACH from the business bank account. This type of split funding requires access to your merchant processing online account at all times or else it would constitute a default.  

When a deal is in underwriting it will be determined if this option is available based on a formula that is heavily weighted on the average ledger balance in the bank account. Unlike direct split, if a business has many overdrafts in the account they will be declined for a variable ach but can still get approved for a direct split or lockbox method.

What’s Needed to Qualify for Split Funding?

  • You must accept credit cards with a minimum of $5,000 per month in credit card sales.
  • You must be in business for at least 3 months
  • You must be a US citizen or have Visa

What Paperwork is Needed to Qualify for Revenue Based Factoring?

  • A signed and complete application
  • Four months of recent business credit card processing statements
  • Four months of recent bank statements

All Varieties of Split funding are derivatives of unsecured business loans since they are not technically loans and advances of future sales at a discount.

Revenue Based Factoring

Revenue-based Factoring

Best for: Businesses that don’t accept credit cards

  • Loan amount: Up to 90% of invoice (invoice factoring)
  • Repayment terms: 3 – 24 months
  • Minimum credit score: No minimum
  • Additional minimum requirements: $100,000 annual revenue, 3 months in business
  • Speed: Approval in 24 – 48 hours, funding in up to 1 week

This type of funding was created through the need for unsecured loans and other funding products for businesses that do not accept credit cards.

Prior to 2008, there was no solution to this problem and all unsecured products (other than split funding) were based on credit card sales. Due to the high funding demands for businesses that don’t accept credit cards, revenue-based factoring was created and ACH loans were born.

The way this type of funding is structured is more based on overall revenue or cash flow. According to the contracts most institutions purchase a set percentage of all your future sales which you as a business owner then sell at a discount.

This percentage of future sales is then estimated over the course of an anticipated term, generally three to 24 months. This future revenue is then collected in a variety of payment options generally on a daily, weekly, bi-weekly or even monthly repayments.

In most instances, it will be daily or weekly and for better-qualified clients, it will be bi-weekly or Monthly. Within the language of the contracts, you have the right to adjust the payments based on your revenue. So if you have a drop in revenue you are allowed to reduce the payment obligations.

This type of funding is usually approved in 24 hours and can fund same day if the stipulations (see the list of items that may be needed) are met. According to the contract, it follows the same rule of thumb as split funding or a merchant cash advance.

A lien may be placed against your future receivables but most institutions do not require any personal guarantee or collateral and are considered unsecured business loans.

Revenue-based factoring will usually subordinate behind any other pre-existing funding you may have and will usually be the last creditor to collect in the case of a bankruptcy or liquidation.

What’s Needed to Qualify for Revenue Based Factoring?

  • You must accept credit cards with a minimum of $5,000 per month in credit card sales.
  • You must be in business for at least 3 months
  • You must be a US citizen or have Visa
  • A signed and complete application
  • Four months of recent business credit card processing statements
  • Four months of recent bank statements

What Paperwork is Needed to Qualify for Revenue Based Factoring?

  • A signed and complete application
  • Four months of recent business credit card processing statements
  • Four months of recent bank statements
  • Financial statements may be required from time to time.

Unsecured Business Line of Credit

Business Line of Credit

Best for: Cash flow

  • Loan amount: $2,500 – $250,000
  • Repayment terms: 6 – 12 months revolving
  • Minimum credit score: 550+
  • Additional minimum requirements: $50,000 annual revenue, 1 year in business
  • Speed: Approval in 30 minutes, funds instantly

These lines of credit revolve based on your outstanding invoices and receivables. Unsecured business lines of credit are not technically unsecured business loans but a line of credit which were designed knowing that many merchants want to have the ability to prepay and draw down on capital as they desire instead of being obliged to take a full funding amount and have to repay it based on the receivables.

The way these products work is, they take into consideration what invoices and receivables a business has outstanding along with the cash flow and revenue to determine a sustainable business line of credit.

The process is relatively straightforward with approvals being issued in about 48 hours. In order to see if your company is eligible for an unsecured line of credit, you have to submit the same application and bank statements as listed with spilt funding and revenue base factoring, but you also must meet the criteria below.

What’s Needed To Qualify for Unsecured Lines of Credit?

  • You must have a business bank account
  • You must be a US citizen
  • Generally, you must maintain an average ledger balance of $1,000 in your business bank account
  • 50k + in Yearly Revenue
  • 1+ years in business
  • Can not be a non profit
  • 540+ FICO
  • Can not have more than 3 Negative days a month in your bank account

What Paperwork is Needed to Qualify for Revenue Based Factoring?

  • A signed and complete application
  • Six months of recent business credit card processing statements (if you accept them at your business)
  • Six months of recent bank statements
  • Financial statements may be required from time to time.

Short Term Loans

Term Loan

Best for: Those who need a quick infusion of cash

  • Loan amount: Funding over $75,000 may require additional documentation
  • Repayment terms: 2 -5 years
  • Minimum credit score: 680+
  • Additional minimum requirements: $500,000 annual revenue, 2 years in business
  • Speed: Approval in 24 – 48 hours, funding in > 72 hours

These types of unsecured small business loans are created to help business owners fill immediate, short-term needs or cash flow issues. This type of funding is structured as a loan with predetermined payment schedules and amounts. With this type of funding its very important to review the contract as the language varies from institution to institution.

Many bigger lenders may require a personal guarantee that can include assets. While some other lenders may include a limited personal guarantee that allows the lending institution to go after personal assets in cases where fraud is committed.

In many cases, it is very hard to prove fraud but in a business where the service is money the lenders use this language as a way to protect themselves against potential fraud.

What’s Needed to Qualify for a Short Term Business Loan?

  • Completed Application
  • 4 months of most recent bank statements
  • 4 months of most recent processing statements
  • Minimum of 2 months in business
  • Minimum of $7,500 in monthly revenue
  • Funding over $75,000 may require additional documentation

What Paperwork is Needed to Qualify for a Short Term Business Loan?

  • Most recent business tax return
  • P&L
  • Balance Sheet

This type of loan doesn’t require a lot of paperwork, funds quickly, and can be used for almost any business purpose. Short-term loans are perfect for purchasing inventory, filling gaps between accounts payable and receivable, as well as any emergency repair or maintenance expenses that may pop up. These loan products generally have repayment terms of 3 to 24 months.

As the alternative lending space is developing and expanding new unsecured business loans are constantly being created. This does not encompass all unsecured business finance products but covers a majority of what we see being utilized by small business owners.

Having said that, below, we’ll cover how unsecured business loans work, why they’re useful, rates and terms, as well as how to get approved for a fast business loan in as little as 24-48 hours:

How an unsecured business loan works

What is an unsecured business loan good for?

Unsecured business loan rates and payment terms

How to qualify for an unsecured business loan

How do unsecured business loans work?

What is the difference between secured and unsecured business loans

Secured business loans

  • Requires collateral
  • Lower rates
  • 680+ credit score
  • 2+ years in business
  • Positive profit & loss tax returns
  • Up to 90 days to get funded
  • Reported to credit bureau and affect utilization

Unsecured Business Loans

  • No collateral required
  • Higher rates
  • Credit score not heavily weighted
  • 6+ months in business
  • Financials not required
  • 24-hour funding
  • Does not affect or report your credit

Unsecured business loan amounts typically range anywhere from $10,000 to $2,000,000 depending on the cash flow of the business being underwritten.

They don’t require you to put down any form of collateral. Hence, making them unsecured for the lender. However, you still need to meet certain basic requirements.

The amount of the loan is dependent upon your:

  • Business’ credit score
  • Average monthly bank balance, and
  • Annual revenue

Unsecured business loans will typically range between 75% to 150% of your last 3 months average gross monthly sales. That means if you deposited $100,000.00 on average for the past 3 months, your business can qualify for $75,000.00 to $150,000.00. Terms typically range between 6 and 18 months.

Keep in mind that if a cash amount is not approved, you as a business owner may instead be offered a line of (unsecured) credit.

In addition, while secured business loans require collateral, such as your house, car, 401k, inventory or account receivables, unsecured loans only require you to pledge limited collateral such as your future sales that only apply to your business.

In fact, funding contracts explicitly state that if you stop having receivables and you go out of business, you’re not entitled to pay back the business loan.

This is one of the primary benefits of an unsecured small business loan. If your business hits a rough patch and you has trouble making payments, or default on the loan, there’s no collateral to lose.

In fact, we’ve found this process to be largely ineffective for ourselves as a lender as well.

It’s our goal to work with you, not against you. So, if you do struggle to make loan payments, we’ll help find you a solution to correct the problem, improve your working capital, and get current once again.

Unsecured business loans: Pros and cons

So far, we’ve touched on some of the benefits of unsecured business loans. Now, let’s cover both the pros and cons of this powerful financing vehicle. 

There is no perfect type of loan for all businesses, and as we discussed earlier there are several different types of unsecured business loans. However, there are some overarching qualities to all unsecured business loans, pros and cons, that you should be aware of. 

Here are the pros and cons of unsecured business loans. 

Pro: Funding is fast and simple

The approval process for traditional bank loans is notoriously long and difficult. When all is said and done, it can take well over a month from start of application to finally get an approval, and longer still to get funded. 

With unsecured business loans, the process is quite the opposite. Assuming your documents are all in order, you can not only be approved within 24 hours, you can also receive the funds in your bank account within another 24 hours. 

That’s a total of 48 hours, lightning-fast compared to the traditional bank lending process. 

Pro: Loan amounts are large

Secured business loans amounts are typically tied to the collateral you use to secure the loan. That means you’ll rarely receive a loan for greater than the value of the asset. 

With unsecured business loans, that’s not necessarily the case. You can be approved for much more than you would have been approved for with a traditional bank loan in some cases. 

Pro: No hard collateral

One of the greatest benefits of unsecured business loans is the fact that they don’t require the kind of hard collateral that traditional bank loans require.

It’s important to keep in mind that a kind of soft collateral may still be required, typically in the form of a promise of future business earnings in the case that you default on your loan. 

However, you’re not required to pay this back in the case that you go out of business, so it doesn’t function the same way that hard asset-based collateral does. 

Con: Higher interest rates

There are several pros to unsecured business loans, and they can be used for virtually any business purpose. However, like all business funding vehicles, they have their downsides as well.

With unsecured business loans, that really comes down to their higher interest rates.

Lenders need some sort of way to ensure they can get their loan back. To that end, they use things like collateral, personal guarantees, and interest. 

Because unsecured business loans don’t have collateral, lenders need another way to make sure they can at least make their loan amount back.

What can you use an unsecured business loan for?

An unsecured business loan can be used for virtually anything you can think of but most use it for working capital.

When business is up, you can use it to:

  • Purchase supplies
  • New equipment
  • Make new hires
  • Add another location
  • And much more

And when business is down:

  • Pump cash into the business
  • Pay accounts payable
  • Pay taxes or other obligations
  • Increase marketing
  • And payroll

Once you obtain an unsecured business loan, it’s completely up to you to determine how you spend the capital to grow or maintain your business.

It’s best to put the capital to work in ways that will help you increase sales and profits, therefore using the capital to create more cash flow over time. However, ultimately, you’ll be the best judge of how to do that with your business.

Unsecured business loan rates and payment terms

Unsecured business loans rates are distinctly different when compared to traditional bank loans.

Clearly, the lack of a personal guarantee or collateral is a huge upside, however, as you might imagine, this upside comes with some downsides.

The unsecured business loan rates and terms can be up to 18 months with payments being due either monthly, weekly, or daily depending on the loan terms.

In addition, unsecured business loan rates vary depending on risk. They can be as low as 14% on unsecured business loans but they can also go much higher as well. A big upside to this, however, is that we can get you approved even if you have a bad credit score and have delinquent or even maxed out tradelines.

How to qualify for an unsecured business loan

Requiring both 2 years of business history and a stellar credit rating, traditional bank loans are out of reach for many business owners.

However, if you find yourself in that boat, an unsecured business loan may just be the perfect solution to your funding needs.

According to the Mission Asset Fund, business loans are declined most often due to “having no credit history or a low credit score.”

Despite this, banks still prioritize credit scores and use an outdated credit-first model for approving (or denying) you for a business loan of any kind.

Rather than dwelling on factors that truthfully have little to do with the state of your business now, we like to focus on the present by looking at the business’ current conditions.

With Excel Capital, there’s no minimum credit score required to qualify for one of our unsecured loans.

When determining if your business is right for an unsecured business loan, our underwriters analyze a variety of metrics such as big data, historical risk models, and trade line distribution to determine its unique growth potential instead of just looking at your credit score.

Having said that, before we can qualify you for a loan, there are 2 qualifications that you must meet:

  1. Records showing at least $10,000 of monthly gross revenue
  2. Proof that you’ve been in business for at least six months

Do banks provide unsecured business loans?

Banks do provide unsecured business loans, however, it’s rare to find one and the requirements are extremely rigid.

Banks want to get their money back first and foremost and aren’t much interested in serving you as a customer, so they’re looking for highly profitable companies that have been in business for a long time.

For that reason, using a traditional bank to get a business loan comes with a variety of strings attached.

For starters, in many cases, you have to pay an upfront application fee just for the banks to process your application. To make matters worse, you usually won’t get your money back even if your application is denied.

A second problem with relying on a bank to provide your unsecured business loan is time. Due to a plethora of banking regulations, regulations that an alternative lender like ourselves doesn’t have to withhold to, banks send you through a large amount of red tape to determine whether or not they will provide you with a small business loan.

All this taken into account, it can take months until you get your money and only if they approve you.

How can I get an unsecured business loan?

A whopping 82 percent of small businesses fail from running out of cash. Is your business in danger of running out of cash flow?

Until recently with the introduction of unsecured business finance, obtaining unsecured business loans was a long, cumbersome process that required trails of paperwork and inconvenienced your day-to-day business operations.

So, we decided to fix that by creating an expedited process to allow small business owners to get through the application process as quickly as possible so you can get back to focusing on what matters– your business.

With Excel Capital, getting the cash your business needs to maintain growth– or simply get through a rough season– has never been easier.

You’ll get an approval decision from us in less than 24 hours and, pending approval, funds will be deposited within your account in as early as 24 hours as well.

Imagine what a surge of cash could do for your business, from providing the funds you need to purchase much-needed equipment to paying off past-due vendors, and virtually anything else in between.

Complete our online application and see how much you can be approved for: Apply Now

Frequently Asked Questions (FAQ)

What happens if you default on an unsecured business loan?

If you default on your loan, a late payment fee may be charged and your interest rate may increase, depending on your agreement. 

However, with no hard collateral requirements, your property and other hard assets such as vehicles or cash savings can’t be taken. That’s one of the major benefits of an unsecured business loan. 

Alternatively, with a traditional bank loan, collateral such as business property is required to secure the loan. That means if you default on your loan the property can be seized to collect on the defaulted debt. 

What is the interest rate on an unsecured business loan?

With no collateral requirements on unsecured business loans, interest rates tend to be higher compared to traditional bank loans. 

Unsecured business loans can go as low as 14% but can be higher, all depending the level of risk factors involved, with terms up to 18 months. 

Can I get a business loan without a personal guarantee?

Yes, you can obtain an unsecured business loan without a personal guarantee. It all depends on your agreement. Depending on your terms, a personal guarantee may or may not be required. 

Can I qualify for a business loan?

Anyone can be approved for an unsecured business loan provided their business is in good standing and they meet the basic credit requirements (500+ score). 

With Excel, you can be approved for an unsecured business loan even with bad credit, as we take a more balanced approach to determining your eligibility for funding by reviewing your entire business’ health. 

What credit score is needed for an unsecured business loan?

Traditional bank loans require very high credit requirements (680+) and have a long and tiresome approval process. 

However, just a 500 minimum credit score is required for our unsecured business loans, making them far easier to be approved for than a traditional loan.