Five ways to get a business loan without the need to approach a bank or investors
Do you have a great business idea? Well, once you've written your business plan, you need to figure out how you're going to see your ideas become a reality. Do you need a large sum or money, or a small one? How long do you want to borrow money for, and most importantly of all, how are you going to get a business loan at all? If you don't want to go on Dragons Den, or approach a bank or bunch of potential investors for a loan, here are five alternative ways you can get the money you need...
1. Use a credit card
One of the easiest ways to borrow money is to use a credit card. A credit card will give you access to potentially thousands of pounds - all of which you can pile into buying stock or equipment, or for hiring an office premises to work from. You'll just need to check that you can afford the interest, and take care not to miss payments. However, bear in mind that getting a business loan in this way is only going to be possible if you've got a strong enough credit rating.
2. Take a loan out against your vehicle
Alternatively, how about taking out a loan against something unrelated to your business? For example, why not take a loan out against your vehicle? You can borrow money to help get your business off the ground, securing it against your car, van (or another type of vehicle) to give you the funds you need. You'll need to repay the loan with interest, but a provider like us will let you keep driving your vehicle as normal, and there aren't any hidden fees to pay either. Read up about how to get a logbook loan online (and be sure to check out our FAQ page while you're at it).
3. Extend your mortgage
It's not a business loan as such, but if you think you can handle the higher repayments and/or a longer term on your mortgage, you could add to the amount of money you've borrowed to buy your house. This is a great idea if you plan to work from home and need to build yourself a proper office in the garden for instance; the bank might consider something like that a wise use of the money because it adds value to your property.
4. Take out an unsecured personal loan
However, if extending your mortgage isn't an option or just doesn't seem like a sensible choice for you, why not apply for an unsecured loan? Again, as with a credit card, you'll need a good credit rating, but if you're successful, you'll have the money you need and won't need to own a house or a car to 'secure' the loan against.
5. Friends and family
Finally, if this kind of borrowing all sounds too daunting and formal, why not ask a friend or family member to consider loaning you the money you need? If you can prove that you've researched your business idea thoroughly first and are confident that it'll take off, a loved one might be prepared to lend you some money. Be sure that you only accept as much as you need and - crucially - no more than you can afford to repay.
These are just a handful of alternative ways to get a business loan. Think about which option might be best for you, weighing up the pros and cons of each carefully before acting on a decision.