Overcome Your Personal Credit Score and Start a Business
The three numbers that make up your credit score determine what kind of car you can buy, the neighborhood you live in and even the job you get. With so much emphasis on it, when it isn’t up to snuff with what credit bureaus require, the stress can be significant. What if you want to start your own business and your score is less than desirable? Will you ever get the money needed to get it off the ground? Depending on the type of business venture you plan on starting, you have options on getting over this hurdle.
Finding Personal Investors
Going the traditional lending route may be more challenging with a low credit score. You may have the greatest business plan and even have positive equity, but if the score doesn’t meet the minimum threshold, you’ll be met with rejection. If this is the case, find personal investors or small investment groups who will take an interest in your vision. You may have to give them a partnership or share in the business, but if doing so gives you the capital you need to get off the ground, it may be worth considering.
Your business is going to require some expensive equipment in the form of computers, printers, copiers and high-end software. If you fall short of funds, consider renting the tools you need. Many companies that provide these types of supplies will have an in-house financing option which allows you to negotiate payment terms and length of contracts. This gives you the ability to have the best equipment at a manageable price. It also means you can upgrade every time your contract comes up and always keep you on the cutting edge of technology.
Liquidating Personal Assets
While you may not want to, your credit score may require you to tap into your personal reserves to get your business off the ground. You may have to sell property or withdraw from retirement accounts to get the funding you need to launch. If you believe in your plan enough, you will recoup whatever money you are forced to invest.
Making mistakes in your financial situation happens. Everybody falls on tough times, and while you have emerged and gotten yourself on the right path, your credit score tells a different story. Remember that the blemishes on your credit sheet will remain for up to seven years. You can, however, successfully start a business utilizing other financing options.