When you’re seeking financing for your business, you may not have the necessary documents on hand to meet the traditional requirements. Luckily, there are financing options that allow you to get loans without extensive documentation.
These no-doc business loans are typically easier to qualify for and provide quick funding. However, they tend to have higher interest rates and shorter repayment terms than other types of business loans. As a result, they can be costly for businesses that require access to capital immediately or have limited credit history or revenue.
While no-doc business loans aren’t appropriate for every type of business, they can be helpful for a variety of different situations. You can find several types of no-doc business loans on the market, including microloans, commercial mortgages, invoice factoring, and business credit cards. Each offers its own set of pros and cons, but most are suitable for younger businesses that have urgent financial needs.
How Do No Doc Business Loans Work?
Most of these no-doc business financing options offer fast turnaround times and minimal paperwork. Some are offered by fintech lenders, which use technology to process and underwrite loan applications. Other options are offered by banks or traditional financial institutions. In some cases, the lender may ask for additional information or documents from you as part of the application process, such as your business plans and financial statements.
There are also a few online lending marketplaces that pair you with lenders who can help you fund your business quickly and easily. These websites usually have simple application processes and can connect you with multiple lenders in a matter of minutes. Generally, these marketplaces only require you to sync your bank accounts and answer some basic questions about your business.
In most cases, the amount of money you can borrow through these no-doc business loans will vary based on your lender, how much capital you need, and whether or not the lender will consider your personal credit score and income when reviewing your application. Some of these options will also require you to provide collateral or other assets to secure the loan.
One example of a no-doc business loan is a Fundbox line of credit. This type of line of credit is offered by a tech-enabled lender and is approved based on the data from your business accounting software, such as QuickBooks Online or Desktop, your bank account, and other financial data. On average, you can receive a decision in about a day.
Other no-doc business loans include equipment financing, inventory financing, and invoice factoring. These types of loans give you quick, easy access to capital by using the value of your company’s assets to determine eligibility. For instance, with an equipment financing loan, you can usually get up to 80% of the cost of your equipment as a loan, depending on the type of asset being used. Similarly, invoice factoring allows you to sell unpaid invoices to a third-party financial services company, which then provides you with funds based on an advance rate that you negotiate with the provider. No Doc Business Loans