First Down Funding is a company that offers working capital loans to small to medium-sized businesses in the U.S. Providing effective business financing solutions to support your business growth, First Down Funding works as a partner with small business owners to provide you with personalized customer service to meet your specific business needs.
Some small businesses go through rough patches where ends can’t seem to meet, especially at the beginning. Your company may be making decent sales, but it might not be enough to have a balanced working capital. Sometimes, even the most successful businesses might have trouble with payroll or utilities.
Many companies need an extra monetary boost before they can become self-sustaining. If your small business is struggling to cover daily expenses, consider a working capital loan.
What Is a Working Capital Loan?
Working capital loans are best used for:
- Small Businesses
- Immediate Cash Funding
- Short-Term Funding
- Borrowers with Poor Credit
The term “working capital” refers to a company’s current expenses minus various outstanding financial responsibilities. This usually means daily costs like rent, but it can also include outstanding debts to loan companies. It’s also common for companies to have working capital problems if their business is only operated seasonally.
For example, an amusement park that’s only open in the summer might take out a working capital loan to cover off-season expenses. When it’s warm again and business is booming, the park can easily repay the working capital loan. The same is true for manufacturing companies, which may only sell their materials during certain times of the year.
Working capital loans can also help sustain businesses between invoices. If too many customers or vendors are late making payments, it can cause your small business to lose revenue over time. Working capital loans also give business owners some extra protection in case of emergencies.
Some small businesses don’t need help with daily expenses, but they still take out working capital loans for growth reasons. The business owner may want to use the loan on a new piece of equipment that could significantly boost its sales. They could also use it to invest in advertising campaigns, like billboards or commercials. In both cases, the business would likely have no problems paying back the loan with the extra revenue.
Working capital loans have flexible terms, ranging from three months to as long as ten years. If it’s a short-term loan, you can expect to have slightly higher interest rates than long-term ones. Additionally, some lenders may take your personal credit score in to account before approving the loan.
Can I Get An SBA Working Capital Loan?
The Small Business Administration recognizes that many new companies need working capital loans at some point. The SBA offers two types of working capital loans: Standard SBA 7(a) loans and Express Loan. Both have a few similar requirements:
- A maximum loan term of 10 years
- A minimum credit score of 640
- The business has already used every other financing option available
- The business’s industry must be approved by the SBA
Both of these loans can be used to cover daily small business operations, paying off debts, and buying new equipment. However, the SBA also explicitly outlines inappropriate uses for both loans, including:
- Paying late withholding taxes
- Replenishing the owner’s personal investment towards their small business
- Using the loan for something that won’t have a positive effect on the company
Getting approved for an SBA 7(a) loan can take up to 90 days, and the maximum loan amount is $5 million. However, this type of loan requires hefty collateral equal to the loan amount. That makes this kind of loan hard to acquire for a business with little assets available.
On the other hand, an SBA Express loan won’t ask for collateral if the loan amount is under $25,000. SBA Express funds also get approved faster, some as little as 45 days. The maximum amount you can borrow for an SBA Express loan is $350,000.
Alternatively, you could work through another lender to get an SBA Loan. However, the SBA still has strict requirements for small businesses:
- No recent bankruptcies
- No outstanding collection dues or tax liens
- U.S. citizenship for the business owner
- Annual gross sales of at least $1.2 million
- At least ten employees
- Two years minimum of operation
Since some companies might not meet such specific rules, a working capital loan is a better solution.
Or you can contact First Down Funding that offers SBA loans with faster approval and no collateral required, regardless of the amount borrowed.
What Are the Requirements to Get a Business Working Capital Loan?
Working with an alternative lender like First Down Funding is often easier than securing a loan from a bank or the SBA. The requirements asked by First Down Funding to get approved for a working capital loan are easier to meet for small businesses. You will need proof indicating your business is healthy, as the last six months of bank statements. For example, most business owners who were approved had an average annual revenue of at least $150,000.
Another advantage of working with First Down Funding is that they don’t require the business owner to have a high credit score to get approved for a working capital loan. While the average minimum credit score to be approved is 600 for other lenders, First Down Funding looks at each applicant’s score on a case-by-case basis. Therefore, if your business has a high annual revenue, your loan application may be accepted even with a lower personal credit score.
How Do I Get a Working Capital Loan With First Down Funding?
Before applying for a working capital loan, make sure it is the best option for your business. For example, if you only want to purchase some new equipment, specialized equipment financing might be a better option. If you’re unsure which funding program is right for you, one of First Down Funding associates can assist you. With an easy online application process, they can help you identify if a working capital loan is the right business loan for you, and if not, provide you with other funding solutions.
First Down Funding is specialized in small business funding services, and unlike traditional funding providers, they will still consider your application even if you have a bad credit score.
Their fees are also straightforward as they charge a percentage of the total loan funded.
You will need to supply bank statements, a valid driver’s license, and a voided business check along with the application. Funding requests are usually processed quickly, but you can get immediate cash flow even sooner if you also provide the following:
- Recent tax returns and credit report
- Proof of ownership and assets
- Balance sheets
After you submit your application and work with a business funding specialist, you can expect a fast approval and your funds back to you in as little as 72 hours.
Is First Down Funding a Good Lender?
First Down Funding offers solutions for small businesses that don’t meet unfair requirements from other lenders. Their team works with each business individually to come up with the best financing solution. First Down Funding is legitimately invested in your small business’s success and will even help you develop and meet business goals.
First Down Funding also prides itself on its easy loan application process. Submitting an application usually doesn’t take more than 10 minutes. Funds are usually available on the same day you get approved.
First Down Funding’s Other Financing Options
In addition to business working capital loans, First Down Funding offers several more funding programs. Each one has easy-to-meet approval criteria and a hassle-free application process. Some small business funding options include:
- Small Business Funding: Get funds to expand can access various financing solutions, such as credit lines or invoice financing
- Merchant Cash Advance: Gives immediate cash flow to business owners in exchange for a small cut of their credit card income
- Bank-Only ACH: Allows business owners to access immediate funds as needed without going through a traditional credit union or bank
- Bridge Funding: Provides small businesses with working capital coverage between other financial obligations
- Short-Term Funding: Gives small businesses one lump sum for temporary expenses
- Long-Term Funding: Provides ongoing relief for small businesses for up to 10 years
- Next Day Funding: Provides an immediate lump sum for struggling small businesses, often on the same day
Easily apply only today to get a working capital loan with First Down Funding or identify the best funding option for your small business.