How to Secure New Financing From Alternative Lenders to Eliminate Working Capital Constraints

Securing traditional financing through banks and other financial organizations remains highly challenging for many businesses. As banks pull back more traditional commercial-and-industrial lending, they are often unable to lend even to small businesses with solid financials. And as their security demands increase, some companies are pushed into distress or unable to take advantage of commercial growth opportunities.

If your company is performing well, you may sill find it difficult to secure sufficient growth capital from your current lender- even though you are growing according to projections. Refinancing a previous line of credit can help support your company’s continued domestic and international growth, especially if your company is stuck in a credit facility that was put in place when your performance was not as strong. Your previous small business loan may have been appropriate at the time, but after a couple years, the pricing may no longer be appropriate for current performance.

It’s a real sign of the times when banks stop or restrict advances against inventory due to internal changes or re-organization. For example, it’s common for lenders to deleverage the inventory financing available to a company and restrict additional funds – even if a company’s numbers are growing.

So what do you do if you’re doing great, but your bank isn’t?

When a bank makes their problems your problem, your business can fall victim to high pricing and/or reduced growth capital due to circumstances at the bank that have nothing to do with your own company’s performance.

In order to capitalize on upcoming commercial growth opportunities, businesses need financing that is affordable and intelligently structured. It is important to look for a lender that recognizes this and is able to refinance your line of credit and increase borrowing availability to support your company’s continued growth.

An experienced alternative lender can secure a credit facility that serves to refinance your previous line of credit. In addition to helping you solve any funding problems created by the bank, an alternative lender may also find it appropriate to work with affiliates to successfully structure and arrange an optimal financing arrangement.

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