A good financing source is very crucial for your business and choosing the right means is going to increase your business’s longevity and success. Unless you choose the best process, you might get saddled with burdened finances that might be troubling for you to pay back. This will result in your credit rating sinking and that would affect your payment history. It is hence, always better to go out for unsecured loans, because that is what is going to help you deal with your loans at lower prices. With many myths revolving around these loans in the market, we are busting the most prevalent myths for you.
Affordability is high
This is the most common myth that revolves around. Many people consider these asset-based loans as very expensive mediums as compared to traditional bank loans. But when you compare these two mediums separately, you will understand how affordable can these secured loans be compared to bank loans. Most business owners like and prefer this source of financing because their accounts are receivable due to the secured mode of financing. When these invoices are sold, you get the most out of their values right then without any hassles. You might also have to pay a small amount for the discount but this is also a lot lesser than what you pay for bank loans.
Flexibility is low
When you are taking a loan from a bank, you are given a set of guidelines and restrictions that you strictly need to follow. They might also ask you how would you spend your cash. Things are completely different in cases of asset-based lending. You do not require to follow any protocol to state how would you use the finances. You can use that for a variety of purposes like:
- Payroll of employees
- Hiring and training
- Inventory purchase
Availability of the loan is tough
This is a very prominent myth that states that only financially troubled companies are going to opt for these loans. But here actually you can approach the loans with much more confidence. They are well secured by your assets, or inventory to be specific. Every growing or well-established company can approach for this loan.
Getting the Accord Financial asset-based loans will help you clear off these myths and get a clearer picture as to how you will be benefited.