Asset-Based Lending: Everything You Need to Know

If you need to obtain a loan to provide your small business with better cash flow and asset liquidity, you might be thinking about the possible benefits of asset based lending. This type of loan is often used by small to mid-sized businesses that are looking for ways to boost financial stability and maintain consistent access to cash. When you think about applying for an asset based loan, these are some of the things you might need to know.

Ease of Access

A loan based on assets may be popular in part because it is so easy to access. Compared to many other types of business loans and lines of credit, asset based loans may prove significantly simpler and quicker to acquire. To qualify for one of these loans, you probably need to have a basic history of profitability and financial responsibility. The approval and underwriting process may be approved in as little as a few weeks from the application date.

Flexible Operation

Many business owners consider asset based lending because of its potential to boost flexibility. Depending on the exact type of loan you choose, you may find that financing can be grown as your revenue increases. Flexible financing that will grow with your company could be the smartest choice for helping build the future you want.

Cash Flow

You likely need consistent cash flow if your company is to take full advantage of opportunities that arise. If you find an excellent deal on merchandise or services, you want to have cash available so you can use that opportunity to boost your business. Asset based lending should allow you to stabilize your financial situation. This strategy could especially benefit companies that are growing quickly as well as businesses that have revenue fluctuations throughout the year.

Moving Up

To accomplish your long-term goals for your company, you likely need to take steps now that will serve as building blocks to bigger and better things. If your small business does not yet qualify for conventional business credit, you may be able to use asset based loans to help build your company’s track record. This could be an important first step toward a bright future for your company.

There are multiple ways in which you may be able to use asset based lending to help grow your small business. These types of loans are generally flexible in nature and easy to access. Also, an asset based loan may allow you to stabilize your financial situation, build a track record and more.


Leave a Reply