As a female business owner, it’s likely that you have faced some type of discrimination when it comes to obtaining commercial financing. Not only are women approved for business loans less often than men, but they also receive less when lenders do approve financing requests. In 2017, the average loan for male business owners was nearly twice that of female business owners. If you currently have credit issues or had them in the past, it can be even more challenging to receive the funding you need.
Know Your Credit Scores
One of the most helpful things you can do when you need to apply for business financing is to request a free annual copy of your business and personal credit files that include a credit score. Personal credit scores range from 300 to 850, with most lenders considering anything over 680 a good score. However, some lenders will only make offers to applicants with credit scores in the very good to excellent range.
Business credit scores range from zero to 100, with 75 the cut-off point for having good credit. Your lender may want to access both files, so be certain you know your scores and make any necessary corrections to your credit files before starting the business loan application process.
Business Financing Options When Your Credit Scores Are Low
Some alternative lenders work exclusively with business owners whose credit scores do not qualify them for traditional financing. Before exploring this option, you should make sure you meet three criteria that bad credit lenders typically have. These include:
- You have been in business for at least one year
- Your annual sales revenue is at least $100,000
- You can provide three months of bank statements for your business along with your loan application
At Evolt Capital, we understand that a credit score does not always reflect the full story. We invite you to contact us today to learn more about our financing options for female business owners with bad credit.