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How to borrow if your business needs financing within days? With or without property

Cash is not king. Cash flow is. In a rapidly evolving business environment, business owners need to derive a strategy to access cash flow in a flash manner. There are a few ways to get quick cash flow apart from an overdraft facility or business credit cards. And when it comes to over $50k or way up to $2mil+ it’s a completely different financing world.

Options - secured vs unsecured

There are fintech lenders that are willing to lend to businesses without property as security, up to $300,000 in some instances although uncommon. These products usually subject to how much turnover your business is doing on a monthly basis. The advantage is you can access this type of financing within days. And it’s undoubtedly a lot easier in the application process. It suits businesses that are not yet ready to show their full financials or tax lodgments.

The other option is to go via asset lending or private lending, lenders that specialize in business lending who understand the importance of simplifying the financing process. If you have equity in your property, a clear purpose of loan and exit strategy, you’ll be able to get the funding within days too.

Cost vs benefit

The cheapest funding available will always be via the banks, if you can wait then going through a bank is definitely the more viable option, subject to meeting their requirements and willingness to be tied to a longer term loan.

But if you need financing fast and short term in nature (as short as three months or as long as two years), the above mentioned two options are available.

If costs is a deterrent, work out the cost benefit analysis. Would your business still be beneficial or profitable with the higher funding costs (and remember it’s temporary measure or short term in nature). An industry veteran once told me this many years ago, always ask the question: “What difference would this $50,000 (or $1,000,000) make to your business?”

The Conclusion

There is always no easy fix in the world of business. And if one size fits all then the world only needs a bank or a lender. And there are various conditions and lending appetite, not mentioning the potential traps and pitfalls in the fine print of a loan contract, may it be easily seen or unseen. Speak to a reputable commercial loans broker who have done it many times while keeping their own contact list of reliable lenders, that’ll save a lot of time, effort and money, it’s like tapping other people’s learnt lessons for free.

Happy trading!

renwong@n1holdings.com.au



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