How to Get Short Term Funding
- July 6, 2021
- Written by : Elizabeth Beall
When we hear short-term funding, most of us think of shorter payment terms and higher fees, right?
Whereas short-term funding is actually referring to the timeframe in which you will receive funding. If the funding period is less than one year, then it is considered short-term financing.
WallStreetMojo goes into a bit more in depth by explaining, “short-term financing means the financing of business, from short-term sources which are for a period of less than one year, helps the company in generating cash for working on the business and for operating expenses, which are usually for a smaller amount and involves generating cash by online loans, lines of credit, invoice financing.”
Now having a clear understanding of exactly what short-term funding is, let’s talk about how you can get short-term funding for your business and why you should consider it in the first place.
How to get short-term funding
Acquiring short-term funding can be simple when done correctly. With us at REIL Capital, you can apply for funding within 3 minutes. However, there are a few things to consider prior to applying that will help gauge your ability to be accepted rather than rejected.
Any type of funding requires a lender (or a bank – not the best). It is best to choose your lender wisely:
- Does the lender have knowledge and/or experience working in your particular industry?
- Can I see myself building a reliable relationship with this lender?
- Does the lender seem to provide solid financial advice, as well as the intended amount of funding?
- Has the lender seen success with other businesses that he or she has helped in the past?
These are all important questions to consider when choosing a lender.
As we mentioned, the next step is completing your application. On ours, the first bits of information we ask for are your name, business’s name, phone number, email, requested funding amount, and purpose of funds requested.
We ask these questions to get an immediate understanding of your business and your business’s needs. After this, you’ll complete the less than 3 minute application, we review it, and then we contact you about your funding opportunity.
If there are no red flags on either end (yours or ours), we can get started as soon as you’d like. Remember with us, you can receive working capital in less than 48 hours.
How to qualify for short-term financing
Prior to applying for any type of funding, it is best to conduct a brief financial background check on yourself.
- What has your spending looked like over the last few years? How about your saving?
- How financially stable and reliable do you look on paper?
- What is your current credit score? How can you work on raising it, if necessary?
It is important to understand where you stand, especially from a lender’s point of view. Now, we are a bit more lenient and understanding when it comes to funding. Our goal is to help businesses no matter the size or financial history, and therefore we typically offer funding to any business with a solid credit score that has been operating for at least two years.
Past that, we do require proper documentation to help secure your funding:
- Completed, accurate application
- Debt schedule
- Business and personal tax returns
- 3 months of business bank statements
- Business profit and loss statements
- Business balance sheet
We promise that this is a short list when compared to other lenders, and don’t worry, we won’t ask you for a longer laundry list either. We are upfront with all of our business owners when it comes to their financial standing. If you don’t qualify for one type of funding, you may qualify for others, and we help you decide.
Want to talk with a financial expert? We’re ready to chat when you are!
Why should I get short-term funding
As our experts at REIL Capital say, “Regardless of your business’ current financial situation, the opportunity to have more working capital is always something to consider. The ability to have long term repayments is attractive to expanding businesses.
Whether it’s to cover costs, pay for your next project, short-term business loans are designed to cover immediate business needs. Rather than hurting your business cash flow, a short-term funding option can provide your business what it needs without slowing you down.”
What are the benefits of short-term financing?
1. You can still get funding even if you’ve been denied by a bank to the SBA.
Sometimes banks and the SBA can be a bit picky. Now, we don’t accept just anyone, but we are much more open and accepting of businesses… even those with a not-so-great financial history. What we focus on is your trustworthiness, your reliability, and your ability to repay the funds we offer.
2. You can bridge cash flow gaps.
With this last year being a downfall for many businesses, we understand the need and desire to get back on your feet. We would love to help you do that through funding. With enough working capital, you can not only pick up where you left off, but continue exceeding your own expectations.
3. You can handle operational costs more easily.
Unfortunately operational costs are often present, and can occasionally be a bit more than anticipated. Our capital specialists say, “if your business is seasonal, or you have new hires, inventory needs, or just looking for working capital in the bank, a short term loan could be the best option for you.”
4. You can feel prepared for emergencies, or mitigate them when they happen.
No matter the emergency, whether small or large, we can help. Some of the more common emergencies we see are equipment and technology malfunctions or breakdowns, office repairs, and weather-related instances. When an emergency occurs, you don’t want to have to fight through weeks of applications, sending of documents, dealing with lenders, and [trying to] patiently wait for capital.
With us, the entire process will take less than 72 hours.
FAQ for short-term funding
When can you use short-term funds?
You can use your short-term funds in less than 72 hours. Let’s break it down:
- Your 3-minute application is completed.
- 24 hour review period takes place; your lender may or may not have questions for you, request additional documentation, or ask for collateral.
- Funding is provided to you on the third day, or earlier.
Need funding now? Apply for funding here.
What is the difference between short-term and long term funding?
How you use your funds is up to you, so long as your lender is aware and agrees. Most businesses use their working capital as excess funds to cover gaps. Whereas with long term financing, most businesses use their working capital for bigger projects and needs, mostly due to the amount of funding requested.
If you’d like to make a financial plan with one of our capital specialists to ensure you are spending your upcoming funds in the right way, contact us today.
Although short-term funding does technically indicate a less-than one year period of funding, we hope to continue our relationship past that. We are a family owned business that understands the crucial need for funding, especially after the years 2020 and 2021.
Allow us to help you succeed, get back on your feet, or start your new, exciting venture in business.