It’s a shame that to this day there are entrepreneurs and business owners who are still not fully educated or aware of the small business loans and financial solutions available to them. This brief list created by Ace Biz Funding details some of the most common small business loan myths and exposes the untruths and half lies each myth represents.
- Online Lenders Are Predatory
This is a common idea for business owners who have not done much research on financial solutions and online lending. The truth is that a large majority of small businesses survive because of online lenders like Ace Biz Funding funds and the industry is doing so well and providing support for so many, that major banks are starting to copy the system developed by online lenders.
[Read the Ace Biz Funding lending blog: Banks are competing with online lenders]
- You Need Flawless Credit
This myth actually exists because of the current system banks use to determine loan worthiness. Of course credit score is going to factor in when you use an alternative lender for financial solutions but the need for incredible credit is one of the small business loan myths that seems to prevent entrepreneurs from trying. Apply for a business loan and try it for yourself.
- It Takes Months
This is another myth that stems from major banks. One of the reasons more business owners are choosing alternative lenders over traditional banks is because the loan approval process is faster and more efficient with online lenders.
- If a Bank Denies the Loan, So Will Online Lenders
It’s easy to understand why an entrepreneur might believe this above all the other small business loan myths because the logic is that if one institution rejects the loan application it should be on a universal basis. The truth is that lenders create a variety of criteria that must be met and they are not always the same.