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Unsecured VS unsecured business credit cards Why You Should Take Advantage Of Business Credit Cards

small business loans despite bad credit Lowdown On Bad Debt Credit Cards, Unsecured Credit Lines AND MORE!


Contents 1.

Secured vs. Unsecured Business Credit Cards

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2.

Small Business Loans Despite Bad Credit

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3.

Take Advantage Of Business Credit Card Offers

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4.

Lowdown On Bad Debt Credit Cards

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5.

Unsecured Credit Line As Your Business Solutions

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Secured vs Unsecured Business Credit Cards

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aving a bad credit record can surely become a

hindrance in establishing your business. Most likely, you will have difficulty in trying to persuade lenders to give you a credit account, which can be very significant for your company. Without a credit account for back up, you are placing your company at a very huge threat of running out of financial resources and even a possible pause in its operations. But because your credit score may not be very constructive to your reputation, you may have very limited options. Either you get an unsecured bad debt credit card or a secured credit card. 1


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In this article, I will reveal the difference between both cards and how they can help your business, especially if you have bad credit. Difference Between A Secured And Unsecured Credit Card A secured credit card would basically require you to have a security deposit in the bank before you can use it. This amount of deposited money will be your guarantee of payment to your lender. Most secured credit cards though, hold credit limits amounting to a percentage of the balance that you have in your account so if your business may need to make large purchases that your balance cannot afford, then this may slow things down. On the other hand, an unsecured credit card allows you to make purchases even without the collateral. But such a lose set-up may also charge high rates of interest and may have stricter penalty agreements for late payments as compared to that of a secured account. Despite this, a lot of people still prefer this type of account, as it seems to offer more flexibility and freedom to its users. However, in cases mentioned above wherein you have a huge debt or a bad credit record, the chances are that signing up for an unsecured account might be too risky. After all, if you are not well disciplined in using your credit card, you might just end up adding more and more to your already escalating debt. How Do I Choose Which Is Best For My Business? Because of the fact that both types of credit cards have good and bad characteristics, the key to choosing which would be best in your situation is to consider the potential of your company to make the right payments as well as its needs.


Secured Vs Unsecured Business Credit Cards

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Bear in mind that you have already started off with an unfavourable credit score. So be sure that if you sign up for an unsecured credit card account, your business is making enough profit to put up timely payments to the lenders. Otherwise, the high interest rates will just further sink your business into bad debt. Also, unsecured credit cards are only best used if the type of business that you have is really in need of a more flexible system of borrowing finances. Such as that of manufacturing companies that need to purchase large quantities of materials in order to have production. In such cases, unsecured credits are reasonable for use. But still, if you are just running a small business and fearful of possibly worsening your already damaged credit score, then opting for a secured credit account will be a much safer bet. With this, you can forego with possibly drowning yourself in escalating rates of interest that your company might not be able to cope up. If you have bad credit, the choice for which credit card would be best for you will basically depend on your business. If your business has high demands for large purchases and if you as the business owner can make sure that you can most probably make your payments on time, then there is nothing wrong with getting an unsecured account. But if your company does not always need to make huge purchases anyway and you want to be sure in improving your credit score by avoiding late payments and huge debts, a secured business credit card is highly advisable. No matter which you choose, always remember that you can only improve your bad credit and pave way to the growth of your business if you handle your finances and credits well.


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Small Business Loans Despite Bad Credit

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t is a common fact that business cannot function

smoothly without capital. Even with a fixed investment for your mini-business, there are always unexpected expenses that will crop up from time to time. The only way to solve this problem is through small business loans. But, is it possible for someone who has a bad credit rating to avail such financial help? Yes, they can! It is true that having a bad credit rating can hinder the possibility of vying for a financial loan to help your small enterprise. 4


Small Business Loans Despite Bad Credit 5 Many traditional and conservative financial institutions, like banks, are only accepting individuals with good credit scores and shunning the rest. But that is no longer the case today. Secured And Unsecured Loans Considering the number of financial lenders in the market, many stay on the competitive side by offering small business loans despite bad credit status. They come in 2 basic forms: secured and unsecured. Secured loans are financial aids with collateral as security, which can either be in residential or business property, or any assets with the same value. Unsecured loans are the opposite; lenders will give you the financial help you ask without any security at all, which can be useful if you don’t have any plans in putting your assets at further risks. Secured loans, however, allow you to loan larger amounts, unlike its counterpart, at lower interest rates and better payment terms. Unsecured loans are usually attached with a much higher interest rate, and much stricter payment schemes. Also, unsecured loans require in-depth credit checks and assurances before you can be accepted for one. Since this type of loan is very risky, especially on the lenders point-of-view, they need to maximize the possibility of getting back what is owed in case things go wrong. However, this can be easily achieved by approaching SBA or Small Business Administration for help. This organization will act as assurance to the lender regarding the unsecured loan despite your bad credit status. Even if you have a bad credit status, you can easily get a small business loan by having ready documents that will testify the financial stability of your business.


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If your venture is earning a sizable income, you can provide financial statements like balance sheets and income statements to give evidence to that fact. Looking For A Lender When you search for a lender of a bad credit small business loan, you need to take into consideration some areas before you proceed. First, you need to keep in mind on the condition of the loan before you get one. Take into consideration interest rates, and payment terms and conditions if you can cope up with it. This is usually the case when you go for secured loans, and using your properties as security. You need to keep in mind that failure to pay these loans can cost you your assets, as well as your business venture. Also, this is a fine opportunity for you to build up your credit score while going for the bad credit loan. Try to look for one with payment schemes that you can readily afford. Prompt payment for these can boost your credit scores up a notch, which will improve of getting much better financial aids in the near future.


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Take Advantage of Business Credit Card Offers

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he business credit cards are not solely designed

for large and well-established companies but also for other small and intermediately sized businesses. Almost everyone can benefit from the several advantages that a business credit card brings. The fact that the monthly cash flows and business cycles exists, there are companies and organizations that are not able to manage without company credit cards. 7


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Credit cards are invaluable for a host of business purposes from simplifying the bookkeeping process to limiting and tracking the business’s monthly expenditures. Additionally, the ownership and use of business credit cards can also help smaller businesses to develop a tone of credibility and legitimacy. This kind of perception will not only manifest in the company’s vendors but also amongst the employees and owners, as well. A business credit card is essential for today’s expanding businesses and organizations. Comparing The Offers There are several business credit cards available through thousands of financial sources. Most of these sources offer the best rates with favorable terms. To become a savvy businessman, it is vital to know the significance of a business credit card that can offer rewards or several perks that have a positive bearing on the business’s purpose, while building a strong credit history at the same time. And so, it is imperative to choose a card that best fit the operations of your business. Be on the lookout for business credit cards with 0% APR or annual percentage rate on either the first 6 to 12 months. Depending on your purchases, there are credit cards offer 5 to 20% cash back bonuses through the Cashback Bonus feature. Other key features that you must review are the following. 1. Annual fees 2. Miles 3. Card Purchases And Transfers On The Balance


Take Advantage Of Business Credit Offers

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4. Liabilities from fraudulence 5. Personalization 6. Additional credit cards 7. Cash rewards on purchases made by additional card holders Benefits for Small Businesses Business credit cards do not only provide assistance in the financial aspect of the business but also bring benefits and rewards to the business owner. You will be able to make the most out of the business credit card through simple advice. You can use your business credit card for emergency reasons. The ultimate challenge for a business is the maintenance of a smooth cash flow. There are businesses challenged by this factor when they have a small budget. There can be moments when emergencies occur, like when you are given a hefty order from a client unexpectedly and you do not have the adequate funds to accomplish the order; this is where the business credit card comes in handy. Through the use of the credit cards, you will be able to charge the expenses and pay it at a later time. After delivering the goods to the client and receiving the payment, you will be able to pay for the expenses you charged. Business credit cards are essential in giving you enough time to stretch your cash and create the necessary adjustments as the situation demands. Lastly, you will be able to track your business expenses more easily. Credit cards provide flexibility to track your business expenses conveniently. You can benefit from the statement of accounts that will reflect all the charges you made in detail.


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Most business credit cards also provide an online account access to its holders. This would enable you to look into your account right from your computer at any time.


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The Lowdown On Bad Debt Credit Cards

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t is common these days to find a lot of people with

bad credit scores. Failure to make payments on time and accumulation of debts are just some of the reasons that could damage a person’s credit history, whether it is personal or for business. If you are one of these people, then you will know that the major problem with this is that most lenders would no longer be able to trust you enough to provide you with financing through credit cards. And if you are running a business that greatly depends on such credit funding, then you might feel that you are in a hopeless situation with no way out of your monetary troubles. 11


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However, all may not be lost for you because it is good to know that a lot of credit card companies today offer an alternative solution through bad debt credit cards. What Are Bad Debt Credit Cards and How Can These Help? A bad debt credit card pretty much works in the same way as most regular credits, with a few exceptions. This type of credit source is designed to cater those with poor credit histories, so along with it may be some policies and terms that are different and even stricter than that of regular accounts. These tighter policies do not necessarily exist to further trap you into your financial problems but they actually aim to encourage you to build up your credit score, just as long as you are able to consistently manage payments and debts with your existing bank. Lenders of this type of credit also give you the advantage of reporting directly to other credit rating agencies about your standing, which could greatly assist in changing the impression on your unfavourable credit record. At least, with an existing source for finances, individuals who are highly reliant on credit to continue production for their businesses are given a chance in carrying on with their operations, and most importantly, earn in order to pay for debts. What Are Some Disadvantages of Having Such Credit Cards and What Should You Look Out For? As good as these credit cards may sound, never forget that they are not regular credit cards and they do have different policies. These come with strict rules and terms to discourage people from not meeting the right payments. In using a bad debt card, expect that there will be higher interest rates for your purchases; therefore you should be very careful in using them. Make sure that you would only use your credit if it is badly needed and if there is no other possible resource for funds.


The Lowdown On Bad Credit Card Debts

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Aside from this, never make purchases through your credit card that you are not capable of paying for on time. If you are not able to handle using your bad debt credit card responsibly, then be prepared to further worsen you credit rating and have your financial problems mount up. Bad debt credit cards offer people a very good alternative to still own a credit card account despite having an unfavourable credit score. This may come with certain limitations that could possibly make your financial standing worse, but keep in mind that this can only happen if you are not careful in handling your credit. This type of credit card aims to encourage people to improve their credit ratings, so make sure to play your end of the bargain. If managed wisely, these types of credit cards can surely go a long way in helping you get out of your financial difficulties and further cater to your personal or business financing needs.


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Unsecured Credit Line As Your Business Solutions

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t some point, the reality with most businesses is

that fluctuation periods would eventually come and such companies will have to face problems regarding their cash flow. A company may experience a financial crisis wherein more cash may be going out than entering as profit. It is very important for any enterprise to never run out of funds, especially if the life of the business is dependent on being able to make large purchases of goods for production. In such dilemmas that many business owners are either facing or are at risk to face in the future, having an unsecured business line of credit could make all the difference. 14


Unsecured Credit Line As Your Business Solution

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What Is An Unsecured Business Line Of Credit And How Does It Help? An unsecured credit line for your business is a type of financing resource that can provide your company with the money that it needs without requiring collateral. Having such a credit line for your company can be of great benefit, especially when faced with problems on cash flow. This can provide you with the temporary funds that your company may need for operations to continue. This is extremely vital especially when funds are simply either lacking or not available but your business is greatly dependent on making purchases for production and profit to come in. Aside from that, this type of credit line can also be beneficial for commercial use in such a way that it involves fewer risks for your part as the business owner as no collateral is involved. This means that you do not necessarily have to gamble your company’s other available resources. Most lenders offering this credit line can also charge less interest and even a bigger credit limit as compared to other sources of finance. Assuring that your company has an unsecured line of credit will be a big step of precautionary on your part to keep your company afloat, even when faced with financial crises. What Should I Consider Before Applying For An Unsecured Credit Line? What you should know about trying to secure such a credit line is that it may not be as easy as you want it to be or that it may not come right at an instant. In applying for unsecured credit lines, lenders would usually take the extra step of checking on your company’s credit history. This is necessary for them to do, as they are risking more by providing you with finances without the collateral.


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And, thus, before you can be approved for an unsecured line, make sure that your company has maintained a favorable credit score. These lenders are interested to find out if whether your company is capable of making the right payments and purchases for both your parties to gain good income. In running your own company, sometimes being prepared for possible problems can surely play a big role in helping you ride the tides of business. For sharp entrepreneurs, even when there is no immediate need for the extra funds, having an unsecured credit account at hand will be a good cautionary tool for anything that could possibly go wrong with the business. After all, you can never know exactly when your company might experience cash flow problems. But knowing that you have back up when funds become unexpectedly tight through unsecured business lines of credit, will surely set a whole lot of difference for your business to step up the ladder.


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