Many recent college graduates have dreams of launching a profitable startup business. Yet student loan debt can make starting a new business even more of a challenge than it already is. Monthly loan payments mean you’ll have less money to invest in your new business funding. In addition, some banks may be unwilling to lend to individuals with too much student loan debt.

Yet college grads shouldn’t write off small business ownership just yet. Those with student loan debt have many options available to them to circumvent this problem:

Need Start up Funding? Consider the Following Options:

• You May Qualify for a Loan Reduction Program — Is your student loan a federal loan? If so, you may qualify for the Income-Based Repayment (IBR) repayment program. This allows you to get a lower monthly payment based in part on how much money you are bringing in every month. One long-term advantage of the program is that student loans may be forgiven after 25 years of repayment.
• Student Loan Refinancing – Another option could be to refinance or consolidate your student loan debt. Some of these options may have particular requirements (such as having actually earned and completed the degree). Some will only work with private lenders while others will only work with private and government lenders. Thus it pays to shop around to find the loan consolidation program that best fits your situation. Either way, getting your monthly payment reduced is a good place to start.
• Alternative Commercial Financing – Depending on your circumstances, you may qualify for asset based lending or invoice factoring. These options allow you to use existing assets, equipment or collateral such as invoices to collect an advance on an invoice. Purchase order financing is a way you can get collect money for a PO even if you have no other collateral. These options may cost more than small business loans but are fast and require less restrictive terms.
• Bootstrap Your Business – Can work from a home office until you start generating enough revenue to rent office space? Can you get a roommate to offset costs of rent? Can you barter or trade IT or bookkeeping services rather than hiring a consultant? Most startups are all about successful bootstrapping and this is particularly true if you have student loan debt.