It’s no secret that specialized businesses are struggling in this economy. The neighborhood hardware store is a perfect example. Whether it’s a local mom and pop or a national franchise, businesses like this have a go-to strategy: strike while the iron is hot.

That iron is heating up along with the weather. Pretty soon it will be time to cash in. The Advance Funds Network (AFN) is here to help you prepare with business loans for bad credit.

The Fiscal Reality Check

Any business can have bouts with bad credit, and hardware stores are just one example. They may see more business in the warmer months, and much less during the wintertime. It can be difficult for seasonal businesses to really thrive in the off-season. For this reason, many specialty stores rely on credit to get through their dry spells. The trouble with this pattern is two-fold:

1. It creates habitual debt.
2. When you’re ready to expand or revamp your business, your past decisions can affect your future plans.

Quite simply, some businesses don’t realize that there’s a better way to do business. That’s why AFN wants to tell you more about business loans for bad credit.

Putting a Wrench in Things

Let’s take a closer look at the by-products of living on credit in the “off-season.”

Entering into debt may be necessary to achieve a goal like getting an education or starting a business, but the very next goal on that list has to be getting out of debt. If it is not, you risk entering a cycle that is extremely difficult to break – the cycle of habitual debt.

What seems like short-term wisdom is often misleading. Transferring balances and debt consolidation may seem like a road out of monetary strain, but most of the time they add to that strain, rather than relieving it.

What people don’t tell you about consolidation is that as part of the agreement, the assisting agency shuts down and cancels your credit accounts. They recommend that you do not open any more lines of credit until you’ve paid off the consolidation. A task they’ve “made easier” for you because closing your active accounts hurts your credit rating. Considering that the average consolidation term is 3 to 10 years, from a professional standpoint, that’s unrealistic.

Transferring a credit balance doesn’t do you much good either. The goal is to move your debt to a low interest account so you can free up your card and pay off the outstanding balance faster. Can you see the flaw in this logic? If debt is a habit, all you’ve done is give yourself a way to rack up more of it.

Hindsight vs. Prevention

The sad fact is living this way in the short-term will cost you in the long-term. If you start to think about expansion, improvement, or even setting up a contingency plan, your credit score can be a self-created barrier to that.

Don’t let it get that far. Apply for business loans for bad credit instead. AFN can help you rebuild your credit, survive the dry spells, and create a sustainable future.