One thing I’ve noticed is that many contractors are so focused on running their businesses that they don’t always realize what financing options may be available to them.

I’m Nick with 850Floyd Financial, and I specialize in helping business owners access capital. I wanted to break down two different types of business funding and explain how your business structure can affect your financing opportunities.

1. Traditional Credit-Based Business Funding

For contractors with strong personal credit, certain business funding programs offer access to capital without requiring proof of business revenue or extensive financial documentation.

Some of these programs are considered no-doc or low-doc funding because qualification is based primarily on your personal credit profile.

The main requirements generally include:

* Strong personal credit profile, preferably 680 or higher, depending on the lender
* A properly registered LLC in a low-risk industry
* A personal credit report that meets the lender’s underwriting standards

Unlike revenue-based financing, these programs may not require an established business to be generating monthly revenue.

Your personal credit profile plays a major role in determining your eligibility and potential funding amount. Lenders may still verify your identity, business information, and other eligibility requirements.

2. Revenue-Based Business Funding

This is another option for contractors who are already generating consistent business revenue but may not qualify for traditional credit-based funding.

Some of the revenue-based funding programs I work with have the following minimum requirements:

* At least $10,000 in monthly business revenue
* That revenue maintained for the last 4 months
* Minimum personal credit score of 500
* Verifiable business bank deposits

Funding amounts are generally determined by your monthly revenue, cash flow, and overall business financial profile.

This can be useful for contractors who need capital to purchase materials, cover payroll, acquire equipment, or take on additional projects.

3. How Shelf Corporations Can Benefit Contractors

Something else many business owners overlook is how their business structure and legal entity age can affect certain financing opportunities.

Some funding programs have minimum business age requirements, which can limit options for contractors operating under newly formed LLCs.

I also have access to aged shelf corporations. These are previously formed legal entities that have already been in existence for a period of time.

Depending on the lender’s requirements, an aged corporation may help satisfy a legal entity age requirement and provide access to financing programs that might not otherwise be available to a newly formed business.

This could potentially expand the funding options available to a qualified borrower, including programs with higher financing limits.

However, an aged corporation doesn’t automatically establish operating history or guarantee larger approvals. Lenders may verify when operations began, ownership changes, and other qualifications.

Here’s my biggest advice to contractors:

Don’t wait until you’re struggling to cover payroll or purchase materials before exploring your financing options.

Understanding how lenders evaluate personal credit, business revenue, and business structure can make a difference when you’re preparing to grow.

I’m curious about something.

For contractors currently running their own businesses, what's been your biggest obstacle to obtaining funding: personal credit requirements, business revenue, or the age of your LLC?

I’d be interested in hearing everyone’s experiences.