Sometimes you need quick cash, and can’t wait on a traditional bank loan to lend you cash. This is where a fast business loan can come in handy. As a smaller business, there are times and things that can happen which cause you to be a little short on cash, even if you have a lot of work coming in. Having the proper business lender is important when going into business. Some quick cash can get you back on track in no time.
A fast business loan is a quick loan that a lender will provide to you within 24 to 48 hours. You can apply (typically online) and will receive your allotted amount once your application has been reviewed and approved. They are easier to qualify for and quicker than traditional bank loans, but you also may pay more fees and higher interest rates with this type of loan.
In this article, we’ll dive deeper into what a fast business loan is, as well as some of the pros and cons that come along with such a loan.
What It Is
As mentioned above, a fast business loan is one of the quickest ways for a business to get cash within a couple of days. If a company needs more funds for inventory, discounted rates, or just has a rough patch, then finding a lender like 1800BizFund is a viable solution.
You need cash quickly, and they can get you your business funding within 24 hours. This can ease a lot of stress and buy the company some time to figure out a plan for how finances will go over the next few months.
Pros of a Fast Business Loan
Other than it being fast cash, is a fast business loan useful for anything else? This is a different type of loan, and therefore has different components to it:
- No collateral is necessary – many lenders will want to make sure you can back up the amount of money you’re taking so quickly, but this is not the case when applying for a fast business loan.
- Flexible requirements – typically, lenders are reasonably tight on their requirements, and rightfully so. However, this is not the case for fast business loans. Lenders will end up being more flexible and take a few more chances.
- Easy to apply – you can apply for this type of loan online, and will be relatively quick. You might have to submit a few documents, but this should be pretty painless.
Of course we want to highlight the positive aspects of fast business loans, but nothing that is good comes without a little bit of drag. Next, we’re going to talk about a few other differences to fast business loans that might force you to think a little bit longer before applying.
Cons of a Fast Business Loan
Quick application, get some fast cash, and problem solved. Well, we do need to go through some of the drawbacks of fast business loans:
- Higher interest rates – one of the risks that you take with fast business loans is higher interest rates. However, the better you look on paper with credit score, revenue, and sound numbers being reported, you might be able to get slightly lower rates.
- More fees – just because you get cash quickly with some potentially lenient rules doesn’t mean you won’t pay for it. Don’t be surprised if you get a fast business loan and a large side of fees to go along with it.
- May put the business in debt – loans are going to be risky, plain and simple. But since fast loans are easier to qualify for, it’s easy to want to borrow more than you might actually need. Be accurate with your numbers across the board, have a tangible plan with backup plans to that, and understand exactly how the money will be allocated.
- Fewer lenders – as can be expected, there are not as many lenders that will give you a fast business loan. It is a riskier loan, and companies are all about hedging risk as much as possible. If they aren’t confident about things going well for them in the long run, then they’re likely to deny you funds.
Of course nobody wants to pay more fees or higher rates, but the lenders have to hedge their bets and make sure their risk of losing money on you is as low as possible. They need to understandably cover themselves the best they can. Some of these drawbacks will make you think twice to ensure you actually need this loan before pulling the trigger.
Conclusion
It seems that many might still be wary of a term like, “loan,” or associate it with a negative connotation. Loans can be absolute lifesavers for businesses if used strategically. If you’re taking a loan, (hopefully) you have a set plan or understand where the cash shortage came from and will be back in no time.
You might just need to fulfill your biggest order and need inventory, payroll is in a week and sales are down for the month. Regardless, if fast cash is the true answer to your problem, then a look into a fast business loan might be worth your time.
Yes, loans are risky. But this is where it could act as an aid to the business in multiple ways. You can pay your bills, buy your inventory, and have a little more peace of mind by having some extra capital. It can also light a fire to make sure you deliver and make things happen. Now you have a little more skin in the game and have to come through for a lender. Trust in you and your business, and do what you have to do to keep going and achieve your dreams.