Kudos to our friends at Direct Capital, who provided us with a few good reasons to get this kind of loan.
We’ve said it before and we’ll say it again: You’ll need a small business loan before you retire. It’s just the nature of running a smaller business, because your profit margins are unlikely to ever be stratospheric.
So it raises the question of what kind of loan you’ll want, who you should turn to in order to get your hands on it and what you should look out for. I’m going to answer the first one today, and the next two shortly in a running series we’re doing in collaboration with Direct Capital. We hope you’ll find this both useful and informative.
The Type Of Loan
So what is the best kind of loan? That depends on a variety of factors, including your business need and what you can afford to pay back. But for our money, the most versatile and useful kind of loan is almost invariably a working capital loan.
What is a working capital loan, you ask? Let’s turn to Direct Capital for that answer:
While big banks may decline businesses for a less-than-perfect credit score, Direct Capital believes that a small business with a healthy cash flow or record of strong credit card receivables should be supported with the financing they need. We provide this service in the form of a working capital loan.
I’m sure most of you have experienced a little frustration with bank financing in the past, so this is probably welcome news. The less stringent requirements and (generally) shorter application process can be a boost, no doubt. But what you’re really looking at a working capital loan for is versatility.
Need to make a new hire but can’t cover the cash flow gap? Working capital loan. Gotta have a little more for your blockbuster advertising efforts featuring you in a polar bear costume? Working capital loan. The possibilities stretch on a long way, which is why we don’t hesitate to recommend at least exploring the option. It may not be the right fit for your business, but if you’re in need of fast cash for any reason, test the wind.
Have you ever used a working capital loan? If not, go check out Direct Capital and see if it’s the right fit for your business.
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