Creative Financing

What do you do when your business has been turned down for bank financing? Without a line of credit, it is hard if not impossible for companies to successfully conduct business, particularly when they are first starting out, or when they want to grow and need access to capital to make growth possible. If you've found your company facing the frustrating and difficult challenge of not being able to secure bank funding, you may want to consider creative financing. With creative financing, you can have access to the cash flow you need to get your business started, growing, or to keep it from failing.

Creative financing defined

Creative financing can mean a number of different things. Overall it means innovative and non-traditional financing methods. For home-buyers, for example, creative financing could mean establishing a financial agreement outside the traditional confines of a mortgage. Sometimes creative financing is used to make a piece of property more tempting for buyers. The goal of creative financing is to create a more attractive sale for buyers, sometimes through better interest rates or financing packages. Reasons for creative financing may include having insufficient finances for a traditional loan, or a need for increased cash flow.

Getting started with creative financing
Are you in the process of starting up your own company? Then you may already have experienced the frustration of trying to access capital through traditional financing methods. If you've visited a bank, expecting to leave with necessary funding needed to start and run your company, you were likely disappointed with their response. Most banks will not offer loans or lines of credit to companies that don't have collateral to back it, and if you are a new company, the only collateral you may have is your residence. Risking your home in order to establish a company is never advisable.

There are many different types of creative financing, and depending on your company and your needs, you may qualify for certain types of it. Some entrepreneurs will use their credit cards against each other in order to have enough cash to get their company started. However, this is a financing method that certainly can't last too long before it will get too costly.

Factoring to the rescue
Factoring, on the other hand, is a form of creative financing that many companies, new or old, qualify for and can benefit from. When you hire a factoring company, you are investing in access to cash that will help start, run and grow your business. Most factoring companies operate by purchasing your account receivables, at a discount. They will pay you in cash, and when your invoices are shipped out with your company's product, your clients will be instructed to pay the factoring company on or before the invoice due date. It's that simple.

Not only do you not have to worry about collecting payment from customers, but you can also reap the benefits of having access to immediate cash. Access to cash will make or break your company. Through factoring, you can receive payment for your invoices within days, not months, of shipment. Many companies use that money to stay on top of payments and bills, using the rest to invest in company growth. If this creative financing option sounds attractive to you, it's time you found out more information on how factoring can benefit your company.

Getting started is simpler than you think. Contact us here today to talk about asset based lending, or apply now to get the process started. We may be able to provide you with cash within 48 hours. Try getting that kind of service at your bank!

FAQ | Glossary | Process | Required Documents | Services
Accounts Receivables Outsourcing | Small Business Funding
Accounts Receivable Management | Business Receivable Factoring
Factoring Financial Services | Accounts Receivable Factoring Company
Factoring Accounts Receivables | Accounts Receivables Factoring