Seeing the words "bad credit" and "business loan" together in today's economy may seem almost paradoxical. In the United States, a low credit score is like a scarlet letter, warning others of potential risks. Whether you want to purchase a car, open a cellular phone line, or even rent an apartment, your credit score helps creditors and lenders determine how risky doing business with you may be.

To the disadvantage of many business owners, the banks' practices are no different. Traditionally, one of the foremost requirements for business loan approval is an excellent credit score, subjecting lots of would-be successful businesses to the laws of Darwinism, competing against businesses owned by people who have excellent credit scores, and qualify for bank business loans.

But contrary to popular belief, it is possible to receive a business loan with less-than-perfect credit, and those who are aware of business cash advances understand that bad credit business loans are not only achievable, but quickly becoming a widespread method of business financing.

You are probably wondering, "If everything stated above about credit scores is true, how can business cash advance lenders afford to offer bad credit business loans?" The secret lies in the unique way in which business cash advances operate. When you receive a business cash advance, you are actually selling your business' future credit card receivables. You get a loan for your business, and the lenders get a small percentage from your daily credit card sales until your business cash advance payment is completed. Lenders use your business' credit card sales history to determine how large of a business cash advance your business' sales can support, and how much money they will be able to lend you.

This system allows lenders to rely on a business' sales potential for loan repayment, taking the weight off of the business owner's credit score. One reason why a credit score is so important to other lenders is because their loans require borrowers to repay loans on fixed monthly terms. Meaning, every month, on a specific date, a certain specified amount of money is due. Lenders want to know that you can be trusted to make these payments on time, each time, and your credit score is a reflection of how well you have been able to do this in the past with other payments.

Since business cash advance lenders do not rely on you to make monthly payments on your loan, they do not need an indicator of how likely you are to make timely payments. Business cash advance lenders take payment matters into their own hands, taking the responsibility, stress and pressure out of yours.

It's no rumor, bad credit business loans do exist, so believe the hype. The availability of business cash advances allows you to keep hope alive for your business, providing you with a source of business financing even if you don't have great credit.