Whether you’re an enterprising entrepreneur or a resourceful investor, funding for your business or investment needs can be elusive.
There is no shortage of methods that can be used for business funding:
- personal savings
- retirement savings
- personal credit cards
- lines of credit on personal assets
- private money or partners
- business/personal loans
However, these methods may be limited in amount and/or require demanding qualifications. Even worse, some methods require use of YOUR money.
Personal capital should be the last resort of any entrepreneur or investor.
Here’s a smarter option: business credit w/ a personal guarantee. This is the route of least resistance.
3 Reasons Why You Should Choose Business Credit w/ a Personal Guarantee:
1. Minimum Qualifications
- Qualifying w/ a personal guarantee is straight-forward. There are only 2 requirements: good personal credit and healthy projected income. Lenders want to know how well an applicant has managed their personal funds, and if the applicant is able to project substantial earnings from their business’s products or services.
2. Quick Transfer of Funds
- Business credit refers to the securing of credit cards under your business entity. Typically, funding w/ a personal guarantee is swift and seamless. There are no long waits or strenuous application processes. Do you recall how quickly lending decisions came back after you applied for personal credit cards? Business credit decisions work the same. Some decisions are instant while others take a little over a week.
3. NO attachment to your personal credit file
- As a business owner/investor it’s best practice to keep your personal credit clean. A clean credit profile characterizes you as an attractive business partner and ideal lending candidate. The benefits of great credit are endless; fortunately, business credit allows you to maintain great personal credit while still granting you access to the capital you need. Although, you are personally guaranteeing funds, business credit does not appear on your personal credit file unless you default. Making the minimum payments required is non-negotiable.
Requirements for business credit w/ a personal guarantee are minimal; however, simply applying does not guarantee maximum funding. I suggest consulting an expert or a professional service. They should be able to assist you with qualifying for and securing maximum funding.
Always evaluate the potential expenses that accompany your selected funding option prior to making decisions.
Raising capital doesn’t need to be stressful or time-consuming.
Don’t allow burdensome lending to slow you down.