The liability of guarantying your family home or assets in the event your operation fails is beyond intimidating especially if you’re in a perilous industry or reeling from short-term financial challenges. And even with the angst factor aside, some business owners just plain don’t have the sort of personal capital required to qualify as sufficient collateral for their loans.
Delinquently, most business lenders require borrowers to offer some form of collateral or personal guarantee. That’s why the capability to use the inventory itself as collateral through inventory financing is such a major perk for borrowers. Lots of business owners who opted inventory financing over other business loan products do so to take eminence of this alternative form of collateral or inventory.

The rate of interest in Inventory Financing will vary, this is based on market conditions and risk level of your inventory.

Inventory Financing allows you to finance your inventory after it is purchased. The lending Companies lends funds up to 80% of inventory’s appraised value. However, lenders uses the Net Orderly Liquidation Value (OLD) or the Forced Sale Liquidation Value (FLV). Please note that the OLV and FLV are normally lower in comparison to the market value. Your ability to leverage the Inventory is affected.