Attempting to start a new business in of itself is extremely difficult and with bad credit, it will certainly be difficult borrowing from traditional sources such as banks or credit unions. I truly don't know many ways to make the process easier with the exception of a possible cosigner or using some form of collateral. Regardless, if your credit is that bad you may want to consider discussing your financial issues with family and friends. Keep in mind, that there's an old saying that the best way to loose good friends is to lend them money. The question becomes what would you have to offer them as an inducement to lend you money and if possible, could you provide some form of collateral. Anybody who would lend you money would recognize that you're going into a new business without any form of a track record and possibly with no cash flow on day one. Consider the possibility of setting up the small business while employed elsewhere. Working it part-time to develop a client base and some level of cash flow to make the transition a little bit easier when you make the break from your current employer. Good luck.
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