A non-profit business can get an unsecured business line of credit if the founder of the organization is willing to provide a personal guarantee. This means the founder of the non-profit organization would use his/her personal credit history to qualify for the unsecured business line of credit. Having a good personal credit history will increase your chances of being able to obtain an unsecured business line of credit for your non-profit business.
What Do You Mean by Good Credit?
Having good credit basically means you have diversified your debt accounts and you’re paying them on time. Having diversified debt accounts means you have different types of debt – this can include, car loans, mortgage loans, and personal credit cards. A diversified personal credit history that is at least five years old and well-maintained may get you approved for an unsecured business line of credit in the shortest time frame possible.
What if the Founder Doesn’t Have Good Credit? What are the Other Options?
In regards to obtaining an unsecured business line of credit for a non-profit business, the only other option would be to have one (or more) of your board of directors act as a personal guarantor for the business. If someone on your board has a good personal credit history, they may qualify. If they agree, be sure to record the board’s formal approval of acting as a personal guarantor for the unsecured business line of credit in the minute meetings.
How Do I Get Started?
LenCred can help you get an unsecured business line of credit for your non-profit business. If you are interested, the first step is contacting them to get started. One of the helpful LenCred advisors will contact you immediately after to discuss the next steps.