Your dream for a small business doesn't have to disappear if you are stuck in a situation with bad credit. Startup financing for new business ventures are a necessary step for most entrepreneurs, and although having a poor personal credit report has probably already taken its toll, there is still a chance for you to have an application for your business approved. The bad news is, it's likely that you'll be incurring higher-than-average interest charges, fees, and costs in order to make it happen. The good news is, you still have a few options!

Before you calculate how much your loan amount will , estimating start-up costs as accurately as possible is a top priority. This will help you prioritize what you may already be able to pay out-of-pocket, or with the help of family, friends, and investors. This can help you naturally save on interest costs, and you'll also have more flexibility in paying back the amounts borrowed.

After you've determined the loan funds you need, you'll need to take your business plan and credit history to the nearest lender. It's important to remember that banks will be less likely to extend a business loan to you if your creditscore is below 640; it's essential that you know your credit score beforehand, and there are a variety of free credit report options available online today. You're also eligible for a no-cost credit report through http://www.annualfreecreditreport.com/. There are three key situations where you won't be able to obtain the startup financing you need:

1. Credit score below 640
2. High debt to equity ratio (this determines your creditworthiness)
3. Insufficient collateral

Business financing is easier if you can separate your business credit from your personal credit. This isn't the case for most startups, but if you have even a small amount of credit history from the business, this can help immensely when working with specialty lenders. Business credit scores are available, and thankfully, theses are not connected to your social security number or personal credit score in any way. A qualified lender can help you determine what this score may be. The business credit bureaus are Experian, Equifax, and Dun& Bradstreet.

Some banks offer their own unique lending programs, often called specialized programs, to help businesses with poor credit. Some can work with your small business administration office to approve the loan. In this case, if you can provide substantive evidence and convince the office of your good credit standing in progress, you have a higher chance of obtaining the credit you need. If the bank or financial institution still denies your loan, here are a few other options:

• Insurance companies; although interest rates are high, many companies can offer short-term revolving debt programs that use the Treasury rate plus a risk premium
• Commercial finance companies; another option where high-interest is part of the game, but more flexibility in products and packages. Repayment options are generally more flexible as well, but interest rates will fluctuate to at least 4-6% higher than standard banks and financial institutions.
• Employee Stock Ownership Plans: getting funds from a company instead of contributions to a retirement plan is another way to free up some startup capital
• Venture capital firms: although these firms usually work with larger companies, many can offer financing opportunities to smaller startups. Beware; interest rates can shoot up to 35-50% in most cases.

Startup financing, even when you have poor credit, doesn't have to damage your business plans and entrepreneurial vision. With the right strategy and accurate forecasting, any small business can take the steps to get up and running with a little resourceful action!