Unsecured business startup loans are the perfect solution for businesses that are just starting. Rather than use their personal assets to start a business, many new business owners prefer to take out business loans. An unsecured loan means that they don't have to risk their own assets.

It's not always easy to get unsecured loans for businesses. You'll need to have a good credit score and a solid business plan for banks to consider loaning you money. If you have these things, however, unsecured business loans will give you the money you need quickly.

You can use an unsecured business loan to:

1. Start your business. Unsecured startup business loans give you the money you need to get your business off the ground.

2. Grow your business. An unsecured business loan can also help you when you want to expand your business, whether you need additional equipment, more employees or a bigger space to work.

3. Improve your cash flow. There are times that you expect payment from your clients, but you don't yet have the cash on hand. This is a great time for business loans. An unsecured loan will allow you to stay afloat while you wait for payments.

Action Steps
The best contacts and resources to help you get it done

Talk to your bank about an unsecured loan for a business

If you need money, your local bank may be your best source. Many banks offer unsecured business loans for their customers, with certain limits based on your credit score. This is a quick and easy way to find a loan.

I recommend: Apply for an SBA-backed loan through US Bank. You can use these loans for almost anything. You can also apply for a loan through First Citizens Bank.

Compare rates for unsecured business loans

When you're applying for an unsecured business loan, you want to make sure that you're getting the best rate possible. Even a slight difference in rate will make a big difference in your pocket. Check out sites that allow you to compare the rates on various loans.

I recommend: Through the popular sites eLoan and Lending Tree, you can view the average loan rates from a variety of companies. This can help you narrow down your search.

Look for unsecured loans for businesses with bad credit

If you have bad credit, you may find that you're having a hard time finding a company that is willing to lend you the money you need. Try to seek out companies that specialize in bad credit business loans.

I recommend: There is a much larger amount of risk when a company loans their money to a business with bad credit, particularly if this is an unsecured loan. To get past this, some companies offer a business cash advance in exchange for a percentage of future sales. This is a great solution for those with bad credit. Check out FastUpFront or Merchant Resources International for these types of services.

Tips & Tactics

Helpful advice for making the most of this Guide

• •  If you find that large banks reject your application for an unsecured business loan, try talking to smaller banks in your area. These banks may be more willing to work with local business owners.