Mastering High Risk Business Loans: Funding Strategies for New Business Ventures and Small Businesses

Get the capital you need to grow your business.
We have the resources and experience to help your business succeed.

Get Started

Mastering High Risk Business Loans: Funding Strategies for New Business Ventures and Small Businesses

Get the capital you need to grow your business.
We have the resources and experience to help your business succeed.

Get Started

Business Financing Solutions

Line of Credit

Equipment Loans

Working Capital

Apply in a few minutes, receive funds in 24 hours

Complete our application form. We will need three months of business bank statements, your business tax ID, and your completed business application to get started!

Review your business financing options that you have received by e-mail. 

After choosing your financing solution and getting approved, our team will distribute the chosen business financing solution capital.

Money Financial Group Office

About Us

A lender who understands your business

Money Financial Group offers financing options for consumer and commercial businesses. We believe in thinking outside the box. MFG has the underwriting creativity and expertise to approve more customers than any other finance company. We also understand that every customer has unique needs, and our mission is to help meet those needs. In many cases, you will find that we can approve applicants with a high debt-to-income ratio, limited income, or low credit profile.

Most common uses for loans

  • Immediate Needs: Address urgent financial requirements with fast funding options that infuse working capital into your business.

  • Slow Periods: Bridge gaps during sales downturns, ensuring you can meet financial obligations and sustain your business.

  • Inventory and Supplies: Allocate funds for purchase orders, enabling you to acquire inventory and supplies promptly, optimizing your operations.

  • Machinery and Equipment: Invest in essential equipment without risking personal assets, enhancing your business’s efficiency and productivity.

  • Rent and Utilities: Free up cash flow to cover operational expenses such as rent and utilities, ensuring timely payments and seamless business operations.

  • Refinancing: Restructure existing debts, like credit card balances, based on favorable terms. Low interest rates and flexible loan options provide opportunities for debt consolidation and financial stability.

Operating a business is a unique challenge, and as it grows, so do the expenses. For entrepreneurs and small business owners considered high risk borrowers, accessing working capital becomes crucial for sustaining and expanding their ventures. Traditional lenders often turn away these borrowers due to perceived risks associated with their credit history or industry. However, at Money Financial Group (MFG), we believe that risk should not define your entrepreneurial journey. We specialize in providing tailored solutions for high-risk borrowers. As an alternative lender, we provide business funding to help businesses in any high risk industry. We understand that most business owners take on a level of risk to build their empire. In this comprehensive guide, we will explore the various types of high-risk business loans, the criteria lenders consider, popular loan uses, interest rates, and answer frequently asked questions to empower you on your funding journey.

Types of High-Risk Business Loans

Merchant Cash Advance (MCA)

A Merchant Cash Advance (MCA) offers immediate access to funds by exchanging a portion of future sales for working capital. It’s an ideal solution for bridging cash flow gaps and covering unexpected expenses. Unlike traditional loans, MCAs put less focus on creditworthiness and provide fast, flexible funding.

Installment Loans

Installment loans, the most popular small business funding option, provide a lump sum that is repaid over time in fixed increments. To qualify, businesses typically need at least six months of operation and a monthly revenue exceeding $10,000. This option offers stability and predictability, enabling borrowers to plan their finances to repay the loan effectively.

Equipment Financing

Equipment financing allows businesses to purchase machinery without risking personal assets. The equipment itself serves as collateral, ensuring that your personal finances remain untouched. This option is ideal for businesses requiring specialized equipment for their operations.

Invoice Factoring

Invoice factoring is an excellent choice for borrowers with a low business credit score, poor personal credit score, or no established credit history. It uses outstanding invoices as collateral, allowing businesses of all credit profiles to secure funding. By leveraging your accounts receivable, a business may access capital without the traditional credit constraints.

Criteria for High-Risk Business Loans Approval

Lenders evaluate several factors when considering high-risk loan applications:

  1. Monthly Revenue: Lenders typically look for a gross monthly revenue of at least $10,000, which correlates with the type of loan and the amount you may qualify for. 

  2. Current Debt: Maintaining a low debt-to-income (DTI) ratio improves your chances of approval, indicating that you can manage additional financial obligations responsibly.

  3. Credit History: While a solid business credit history is advantageous, it is not the sole determining factor. Lenders assess your overall financial health and business performance.

  4. Length of Time in Business: Lenders prefer businesses operating for a minimum of six months. Longer business tenure increases approval odds and offers access to more competitive rates.

  5. Profitability: Demonstrating consistent profitability showcases your ability to manage finances effectively, making your application more appealing to lenders.

  6. Bank Statements: Providing the last three months of bank statements validates your operating cash flow. Healthy finances strengthen your application, highlighting your ability to manage funds efficiently. A strong business financial history builds rapport with high-risk lenders.

Interest Rates and Eligibility for High Risk Business Loans

Interest rates for high-risk loans vary based on individual eligibility factors. At MFG, we offer competitive low Annual Percentage Rates (APR) starting at just 7%. Determining personalized interest rates involves assessing your unique circumstances, and ensuring you receive a loan tailored to your needs. We understand that traditional bank loans, short-term loans, and business credit cards are known for charging high interest rates. However, we help business borrowers obtain the best business lending option to secure the ideal route to fit their specific borrowing needs. 

Conclusion

In the world of high-risk business loans, understanding the available options and eligibility criteria is crucial for making informed decisions. MFG stands as a reliable partner, offering fast, flexible, and tailored solutions for high-risk borrowers. By empowering entrepreneurs with the knowledge and resources needed to secure funding, we pave the way for businesses to thrive despite challenges. Remember, risk is just a hurdle, not a roadblock. With the right funding partner and strategic approach, your business can achieve the success it deserves.

Explore our comprehensive guide, consult with our funding advisers, and embark on your journey toward financial stability and business growth. Let Money Financial Group be your bridge to a brighter, more prosperous future!

Frequently Asked Questions about Business Funding for High-Risk Loans

Lenders consider various factors, including credit history, business performance, and loan amount, to determine interest rates. Money Financial Group offers competitive APRs tailored to your specific situation.

Yes, you can. Money Financial Group provides loan products for business owners with bad credit history and no personal guarantee. Our funding advisers can explore different options with you, ensuring you find a suitable product.

Real estate, construction, restaurants, and retail businesses are considered high risk due to inconsistent revenue. Lenders exercise caution with these sectors, offering higher interest rates or specific loan options.

Lenders categorize borrowers with poor credit histories or those lacking a history of responsible borrowing as high-risk candidates. These individuals face challenges when seeking traditional loans.

Yes, startups can secure high-risk loans. MFG works with entrepreneurs launching new businesses, providing them with the necessary capital to cover initial expenses and accelerate growth.

Our streamlined process ensures swift approval and funding, allowing high-risk borrowers to access funds within the next business day to a few business days. Timeframes may vary based on individual circumstances.

Defaulting on a business loan is followed by consequences, including damaged credit and potential legal actions. It’s crucial to communicate with the lender if financial challenges arise to explore alternative repayment options.

While specific government programs cater to small businesses, eligibility criteria vary. High-risk small businesses may apply for an SBA loan to get a small business loan. Government programs also provide alternatives to high-risk business loans. It's advisable to research government initiatives and consult financial experts to determine the best options for your business.

Applying for multiple loans simultaneously can negatively impact your credit score and loan approval odds. The best high risk types of business loans include secured loans, unsecured business loans, business lines of credit, business cash advances and invoice factoring. It’s advisable to carefully assess your needs and apply for loans strategically.

Defaulting on a high-risk business loan is one way to legal actions, damaged credit, and difficulty obtaining future financing. It’s essential to communicate with the lender, explore repayment solutions, and seek financial advice if facing challenges.

Some funding options are based on the purchase of a portion of future business revenue generated from sales of the applicant’s business. Funding options are not available in all states and are subject to certain eligibility requirements and approval. Pre-Qualification is not a guarantee of approval, but rather the minimum qualification criteria. The cost varies depending on certain factors such as, but not limited to: industry and time in business. Payment frequency and terms vary by transaction and product type. Approval and Funding time-frames vary by transaction, product type, and submission day and time