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There are a variety of alternatives available to small-scale business owners looking for working capital loans to help them get their business off the ground. Some of these include SBA 7(a) term loans as well as working capital loans that are not secured. Alternative financing models may also be available to help finance your small business.

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SBA 7(a) term loans
If you are a small-scale business owner who is in need of working capital, you should think about applying for SBA 7(a) term loans. These loans are flexible and can be used for a variety of purposes. You can use the money to refinance debt, grow your business, or for purchasing assets.

The SBA guarantees a portion of the loan to reduce the likely that lenders default. The guarantee comes with a cost. This is typically 3.75 percent of the loan’s guaranteed amount.

Anyone interested can gain a better understanding of the SBA 7(a) loan by looking through the SBA website. They will also have access to the SBA Lender Match tool, which connects applicants to SBA-approved lenders within two days.

Like all loans, the rate of interest for 7(a) loans can vary depending on the amount and repayment conditions. It could be fixed, variable, or linked to the Prime Rate.

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To be eligible for an SBA 7(a) loan, you will need to submit an application and get it approved. The lender will look over your financial history and review your business plan. Once you have been approved, you sign a loan contract to receive the loan funds.

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Unsecured working capital loans
An unsecured working capital loan is a smart financial decision regardless of whether or not you are expanding or starting out. It can be used to purchase equipment or expand your business or to upgrade your building. The right one can help your business grow.

The process of getting a working capital loan may be more straightforward than you think. It is possible to get a loan using just one page unlike the line credit. You can even fund your loan by using 3 months of bank statements from your business.

Unsecured loans have higher interest rates. This is because the lender is taking on more risk. As such an owner of a business should have a high credit score to be eligible. In addition, you should have a plan to repay the loan on time.

Unsecured working capital loans are an excellent solution to bridge a financial gap in your business. You can get low prices on essential products or upgrades to your facilities with working capital loans. Getting a working capital loan will enable you to continue to operate in tough economic times.

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An unsecured working capital loan offers another advantage: you don’t have to pledge any of your assets. Typically lenders will require an online payment processor and the deposit account.

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Small-scale businesses have additional financing options
Many entrepreneurs are turning to alternative financing models for small businesses as the most preferred option. These flexible financing options can help you get the cash you need for growth.

Alternative loans are also less expensive than traditional ones. Banks typically require large down-payments and you may have wait for a while before you can get the funds you require.

Some alternative business loan options include lines of credit, invoice discounting, credit card, and cash advances from merchants. All of these options give you the chance to get funding quickly and easily.

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Business lines of credit are similar to credit cards, with the exception that they charge only interest on the cash you withdraw. These options are especially useful for short-term expenses.

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Working capital loans are useful to cover the cost of daily expenses, such as purchasing inventory or paying employees. However, they are not appropriate for large-scale business changes.

If you are choosing a lender to get an alternative business loan, make sure you work with a company that has experience. Also, think about your credit score. Your chances of getting a favorable loan deal are higher if you have a better credit score.

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Peer-to-peer lending is a different finance option for small-sized businesses. Peer-tobusiness lenders offer small businesses with loans from multiple investors, much like crowdfunding. This option is especially beneficial for small-sized businesses that do not have collateral.

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