So you have poor credit, and you want to start a small business? You need to ask yourself honestly: do you really have any business starting your own business? If you have poor credit, that's a pretty good sign you haven't been responsible with your money. I have been in your position and have been able to succeed but it wasn't easy. It took thousands of hours of work and I want you to make sure that you know what you're getting yourself into.

Can you trust yourself with a bundle of money to start a new business, when you haven't done a very good job with the money you've had? Do you expect some kind of miracle? You'd probably do better buying a lottery ticket. Or hoping that you have some rich relative somewhere that has willed you all their money.

There's a very wise proverb that says, "The one who is faithful with little will be given much. The one who is not faithful, even what he has will be taken away." Perhaps you need to work on being faithful with the little you have, rather than trying to spend your way out of your predicament. Too much spending is probably what got you in the predicament in the first place.

Consider also that an overwhelming percentage of new businesses fail within the first year. I've met guys who are passionate and excited about their business plan, they pour their heart and soul into it - and they fail. Passion does not make for success. Those who take out small business loans with poor credit are even more likely to fail because they haven't taken care of business in their lives. This obviously complicates things and is one more problem that you'll have to overcome if you're going to make it.

Suppose that in your case, you have poor credit even though you have been responsible. Maybe you grew up poor, and just never had a chance to make it. Then perhaps you should think about starting small. That's what Bill Gates did. He worked his tail off to sell his first software, and then built gradually on his success.

People who are successful at starting small businesses, usually learn the business first as someone else's employee. That way, besides building up a financial base for themselves, they learn all about the business from the inside. When they start for themselves, they are able to anticipate all the problems and overcome them successfully. If you go through this process, you should not have difficulties with poor credit by the time you start your business.

If your idea is to get rich quick, realistically you'll get poor even quicker. See what's happened to the U.S. economy. People bought stuff they couldn't afford, and had the rug pulled out from under them. People who get small business loans with poor credit often fall into the same predicament.

If you want to make it, learn a lot about business BEFORE taking out poor credit small business loans. This will help you to have the confidence you need to succeed.

Most of the time these loans are actually bank loans that are backed by the government. They are different from most other loans in several ways. For example, let's look at debt consolidation loans for bad credit. These loans carry insane interest because they are completely unsecured. Small business loans are generally backed by the federal government and are also unsecured, but carry interest rates that are much lower because of their federal backing.

These loans really aren't too bad and there are lots of loans that are better and worse. For example, auto loans will have better interest rates but you won't get any cash in hand. This doesn't do you any good as a business owner. Personal loans have insane interest and you wouldn't want to use them as a loan for business. Student loans are the best loans on the planet but they have to be used for education. Home loans don't really do anything for a business owner unless you want to use a home equity loan which could free up some excess cash and allow you to pay less interest than a business loan. Since you probably have bad credit if you're reading this article you might want to take a look at my article on home equity loans for people with bad credit.

Over time small business loans work out pretty well for you, especially if you look at them against other loan options. However, it's on you to make sure that your business plan is solid so that you can pay back your loan. We don't want you looking for bill consolidation loans anytime soon. :)