Can I get a loan based on my assets?
For small businesses, traditional financing methods aren’t always feasible. Asset-based loans can provide an easy alternative to standard bank loans. And bank loans can often be difficult to secure for a small company. If you are a small business owner looking for a way to inject some much-needed capital into your accounts, you can use the assets you already have to acquire your interim funding.
What are asset-based loans
Whether you need a short-term loan or a revolving line of credit, asset-based lending (ABL) can offer the solution you need. Your company’s assets, which stand as collateral for the loan, determine your credit limit. ABL is based on the liquidity value of your assets. This means that the collateral value remains stable even during fluctuations and downturns. If you have plenty of inventory and accounts receivable, ABL is a great way to get access to cash. You don’t sell your assets, but you borrow against them.
The benefits of ABL
ABL is an easy way to access a cash injection in a short period of time. It can be used to support company growth and expansion, mergers and acquisitions, or shareholder buyouts. You can also use it to help you purchase new equipment. Or, you can expand production infrastructure to meet the demands of key contracts.
ABL is based on asset value, not monthly profit margins, and does not require projections of your earnings for approval. It is flexible and may allow for frequent cash advances as needed.