When it comes to the ins and outs of small business financing, many small business owners are in the dark. According to a recent QuickBooks survey,  more than 40 percent of small business owners consider themselves financially illiterate. With so many small business owners not understanding even the fundamentals of business finance, it is little wonder why there are so many myths floating around about the small business lending process.

Below are five of the biggest myths about business financing that small business owners tend to believe and the mistakes these fallacies typically lead to:

Myth #1: Your bank will lend you the money because you’re a longtime customer. If you need a business loan, you can just head to your local bank, right? After all, you’ve been a loyal customer for years. Why not capitalize on the relationship? The reality is that most banks these days are still tight-fisted when it comes to funding the nation’s smallest businesses. Plus, the smaller and more local your bank is, the less likely it is that they’ll offer you funding.

Myth #2: You can’t get a loan if you have bad credit. This myth is based on an element of truth. If you or your business is struggling with bad credit, then you will have a hard time getting a decent loan from from most traditional lenders. There are some ways around this, however. For example, you could take out a series of short-term microloans in order to get the needed financing and help rebuild your credit. You could also tap into an asset-based financing arrangement, such as a merchant cash advance or accounts receivables financing.

Myth #3: You can just get a loan from the SBA. First of all, the SBA is not in the business of extending loans to small businesses. What they do is work with traditional lenders. The SBA offers a guarantee on any qualifying loans their lender partners extend to small businesses. What this does is significantly minimizes the risk associated with extending the loan in the first place. While this setup allows many more smaller businesses to get cheap, long term financing, the bar is still set relatively high when it comes to the requirements for approval, such as sales volume, time in business, and industry.

Myth #4: Alternative lending is for businesses that can’t get financing elsewhere. While this statement may have been true both during and immediately following the recession, today alternative lending is becoming more and more mainstream. Not only are business owners getting more comfortable with accessing financing from online lenders, but the lenders themselves have created feature-rich, sophisticated platforms that efficiently and effectively help them to finance a wide assortment of businesses. Some industry experts are even calling alternative financing the new traditional business lending.

Myth #5: Alternative lenders will try to scam you. While there are certainly some bad apples out there in the realm of alternative financing, the reality is alternative lending has come a long way over the past few years. Today, there are many more legitimate alternative lenders offering quality products and services. You just need to make the effort to educate yourself about your options and do your due diligence before agreeing to work with any particular lender or platform.

In short, business finance is one area you don’t want to be ignorant about. Take the time to educate yourself on the fundamentals of financing and of the current realities in small business lending. Not only will this help you to steer clear of some prevalent myths, but you’ll also be in the best position to find the optimal financing arrangements to suit your business.

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