Do you need extra capital to grow your business?

Having your own business is no easy feat. While every single one starts with a good idea and plan, these often fail due to the inability to meet the challenges that come with it.

One of the most common roadblocks is funding. Without enough funds to start and maintain the business, it’s almost certainly doomed to fail.

Fortunately, financing companies now offer solutions to this problem. Startup business financing is an ideal way to acquire the capital needed to reach business goals.

Today, we will discuss what startup business financing is and how to obtain it from finance startup ideas vatcpa.

Ways to Get Capital for Startup Business Financing

The first months and years of operations are the most crucial for any business. During this time, many business owners make the mistake of overspending and subsequently putting the business’ future at risk.

To avoid this, it’s wise to save your capital by utilizing startup business financing. But before we elaborate more on this, let’s first define what capital is.

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H3: What is a Capital?

Capital is money needed to finance a new business, and is typically used to:

  • Lease or rent a commercial space,
  • Get business permits or licenses,
  • Hire and pay new and existing employees,
  • Buy equipment, and
  • Market their business.

Capital is used to finance every aspect of a business’ operations. Because of this, it needs to be sufficient to support the first few months, or even years, of operation.

However, access to such funds can be difficult to come by for many businesses. If you’re one of them, read on to find out how you can go about financing your business.

What is Startup Business Financing?

Getting financial assistance from traditional lenders is close to impossible for startups due to strict policies. Hence, they must look elsewhere to acquire necessary funds.

This can be done through startup business financing from financing companies. Aside from having less requirements, financing companies are also able to customize their services to suit your unique business goals.

However, as with traditional lenders, rates offered by financing companies are dependent on several factors.

Factors That Affect  Financing Rates

Your rates and monthly payments for startup business financing largely depend on your credit score.

Usually, financing companies give lower rates to businesses with a credit rating above 650. However, large down payments can also help lower rates even further.

On the other hand, high monthly payments can be expected if you have low credit and do not make a large down payment.

Aside from these, financing companies also look for collateral, such as deposits, home equity, and existing equipment to ensure you can cover the monthly payments.

Monthly Payments for  Business Financing

Partner with reliable companies which has a start up equipment financing program that will work with your business’ finances. These programs ensure you will be able to repay your loan with ease.

For example, the following are some of the programs finance startup ideas vatcpa offers, along with their expected monthly payments.

1. Application Only Program for Good Credit

The application only program with 6-9% rates is often offered to businesses with at least 650 FICO score. Businesses who choose this could receive a loan up to $100,000.

If you have a good credit score and stable cash flow, your monthly payments for a 72-month contract will be $1,657.

2. Financing for Business for Bad Credit

Even if you have a low credit rating, you can still receive startup business financing.  Unlike other financing companies, finance startup ideas vatcpa helps businesses with a credit rating below 650.

This program offers higher rates – roughly 13-35% – with potential loans given up to $150,000.

Monthly payments for this program would be $5,006.82.

By Genaro Martin

Linda Martin: Linda, a renowned management consultant, offers strategies for leadership, team building, and performance management in her blog.