Where Can I Get Some Short-Term Business Financing?
Most business find themselves with a lack of liquidity from time to time. Sometimes needing short-term cash to meet monthly obligations. Maybe a shipment was delayed, a big client didn’t pay on time, or the cash was need for another opportunity elsewhere. When the timing is so short, it doesn’t make sense applying for a traditional small business loan.
Consider the following ideas to help get that needed cash in the short-term.
Line of Credit
A line of credit is available through your local bank. Similar to a credit card, it is connected to your bank account and you can draw on those funds quickly. Just remember to pay it back when that big payment from the client comes in. It’s also a pretty good idea to dig your well before you’re thirsty. In other words, set up the line of credit before you need it. Still, this application process is shorter than the traditional small business loan.
Some payroll lenders provide short-term loans for business put to $100,000. To get this type of loan, you must have a business that has been around for some time and a specific revenue that you can prove. There are a variety of terms for this type of financing, so shop carefully for the one that meets your business needs.
U.S. Small Business Administration
Yes they have loans for small business owners. The loan will depend on your business needs. The SBA also makes recommendations to local lenders and connect to various small business organizations. This might be a great option to check out before you need the funds. As you would expect this will be a longer wait for the funds you need quickly.
Tapping Your Retirement Account
I really hate to even mention this one. Some business owners have used this account for loans for their small business for years. My personal feeling is that, unless it’s an emergency and you cannot find the money from any other source, don’t use this account. It’s for retirement. You might also want to beware of any penalties or taxes that may result in accessing this account.
Certainly not an exhaustive list, but a good start. Every business will go through a liquidity event at some point. Be smart, and look for the short-term financing before you need it. You will thank yourself when the time comes. Call me at (859) 225-2596.