Small Business Loans With Bad Credit: Some Answers

Mary asks…

I need a small business loan with really bad credit. Is this possible?

I have read all of the other questions in this category all answers are about the same. Have done some research but serious about needing a loan with bad credit. Bring in $70,000 a yr from job that will be kept!! Need aproximatley $5,000 to $10,000 to start business that I know will take off! The only problem is I have seriously bad credit. No collateral. I know this sounds far fetched, but is it possible? All bad credit is from medical bills or little things.

admin answers:

If you make 75,00 a year then you should be able to make it happen. Collateral is how i have done all of my larger loans, but you may have to either have a co signer, or just take a high interest rate on the loan in your name.

Lizzie asks…

cani get a small business loan/grant with bad credit?

i have a $8,000 with a bank and a few old phone bills and would like to borrow any where from 5,000 to 30,000

admin answers:

Grant maybe, loan no

Linda asks…

how can i get a loan with bad credit to start a small business?

10,000 dollar loan to start a carpet cleaning business.

admin answers:

Unless you have collateral like a house or newer car to take a loan against, you can probably forget about getting a loan to open your business. I know a lot of people think the Small Business Administration will help, but their funds are limited and so they can help only select applicants with good credit and a sound business plan that will likely succeed, after they have been turned down by a couple of different banks.

The other route is to find someone with good credit or assets who will guarantee the loan, and there really aren’t a lot of people willing to take that risk, even for a friend or family member. I’ve started businesses before, I had good credit in a time when the banks would lend money to almost anyone, but they turned me down. I ended up having to run up my credit cards and pay off high interest from them. That’s what a lot of entrepreneurs do. It’s sad you have to put your personal credit and all your personal assets at risk but that’s what most of us do when we are starting out.

Now, if you have limited assets and no one who trusts you personally enough to lend the money, here’s a few options:

Start a general cleaning business on the side. Using your vacuum cleaner, home carpet cleaner, a mop and bucket, some rubber gloves and other general cleaning supplies which you probably already own. Some people will even provide the cleaning supplies if you will do a good job and come when you are supposed to. It pays pretty well and it really mostly all labor. Don’t forget to with-hold enough to pay your own taxes, use the rest to set aside as extra income toward your goal of opening your own carpet cleaning business.

Ask the person selling you the equipment for the carpet cleaning business if he/she will let you pay it out in installments as you earn money with it. If someone is selling a used van and carpet cleaning system, they might let you do that. Even offer to “technically” work for them, but with the total profit of doing each job they send you to going toward the selling price of the equipment. Work other carpet cleaning jobs you line up in the evenings or on weekends for personal income. They may charge you a little more for the equipment to do this, but figure that as finance charges. Just be honest, true to your word and pay them no matter what, no excuses. If the equipment breaks down, be ready to fix it yourself, they are doing you a favor, you shouldn’t expect them to pay for it.

Start lining up carpet cleaning jobs, rent the equipment at the hardware store or tool rental place. Most people don’t care if it is a van, they just want a clean carpet.

Make sure carpet is popular where you live. Many people have been switching to wood floors and laminate wood floors. Go to work for one of the companies installing wood laminates. Learn how to do it, it really isn’t that difficult to install them with just a little practice. The customer picks out and purchases the flooring and sound barrier, at one of the “do it yourself” stores, all it takes for you is a power saw with the correct blade, a tool to snug the planks together…very inexpensive and some knee pads. Try to learn how to sand and refinish existing wood floors. Again you could rent the equipment when you have a job until you can afford to buy your own.

If you do things that will be mostly all competitive labor cost to get the money, you will find it will add up within a year or less. Just don’t spend the “extra” money for anything else.

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