What Is
Asset-Based Loan?
An asset-based loan is a type of financing secured by collateral that the borrower owns. This collateral can include:
01
Real Estate:
Property owned by the business.
02
Long-Lasting Beauty:
Outstanding invoices or payments due.
03
Empowerment and Purpose:
Machinery or tools used in business operations.
04
Exclusive Open House Offer:
Any other valuable assets owned by the business.
How It Works
If the borrower defaults on the loan, the lender has the right to claim the collateral to recover the outstanding debt. This reduces the lender's risk and can make it easier for businesses to obtain financing.
Can You Get a Business Loan Without Collateral?
- Term Loans: Traditional loans with fixed terms and payments.
- Lines of Credit: Flexible borrowing options that allow access to funds as needed.
- Merchant Cash Advance: Advances based on future credit card sales or receivables.
- Lines of Credit: Flexible borrowing options that allow access to funds as needed.
What Do You Need to Qualify?
- 3+ Months in Business: Some financing options are available with as little as 3 months of business operation.
- $5,000+ Monthly Gross Sales: A minimum revenue requirement of $5,000 per month, or $60,000 annually, is often needed.
- No Minimum FICO Score: Many financing options are available without a minimum FICO score requirement, accommodating a range of credit profiles.
- Asset-Based Loans: Secured by collateral such as real estate, accounts receivable, or equipment. Lenders can claim the collateral if the borrower defaults.
- Unsecured Loans: Include term loans, lines of credit, merchant cash advances, and equipment financing, which do not require collateral.
- Qualification Criteria: Typically includes being in business for at least 3 months, having $5,000+ in monthly gross sales, and no minimum FICO score for some options.
If you need more information or assistance with securing a loan, reach out to an Asenta Capital Business Financing Advisor today!
