Archive for business loan tips

small-business-loan-need-approved-tipsThe traditional way to keep your small business running smoothly is to rely on a small business loan.  You may acquire them from credit unions, loan experts and other financial institutions.  But before getting approved gain a greater understanding of what is needed to ensure you provide all necessary information.

The Success of Your Business

A lender first looks at the competence at which you are able to pay back a loan.  This is determined by factoring the success of your business.  Does your company handle enough business to pay back the loan without delay?  The lender examines how much operating capital is needed for your business versus how much current revenue is earned.  This helps the lender decide if you qualify for a small business loan or not.

Your Business Track Record

This goes along with the success of your business but in a different manner.  The lender views the history of your business, and any past business dealings on your part.  Have any filings for bankruptcy been made due to lack of money for business in the past?  Have you run successful companies before or have the prior ones all failed?  These facts do factor into attaining a small business loan.

How Much Money is Needed and for What Reason

When applying for a small business loan, the lender looks at the amount needed and what is the purpose.  For instance, if you need funding for expansion costs, does the money requested cover the costs or does it fall short.  The opposite also applies to this situation.  If you ask for more money than what is needed, the bank may drill you on why the amounts don’t match up.

To find out more about how to attain a small business loan, talk to one of our unsecured business loan experts today!

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The key to obtaining a small business loan is found in the material provided with the loan.  The paperwork prepared and turned in with an application gives applicants an edge in regards to being approved.  If the paperwork is thorough the first time around, then a person saves time, money and grief from having to redo any of it.  The lender will be pleased enabling you to attain the money for the business in shorter amount of time than initially projected.  Here are two essential components needed to be included in your loan application.  This sound advice will kick you off in the right direction.

Write a Loan Objective

A lender wants to see how the money from the loan will be divided amongst your business needs.  Therefore, include a financial breakdown assigned to rental space, equipment, vendors, salary, taxes and other operating costs.  It also proves to the lender that you have a great understanding of how much money is needed and where it will be allocated.  It shows a level of confidence and completeness other business owners may be lacking.  As a result, it embeds in a lender’s mind you know exactly what you are doing eliminating any professional doubt about loan approval.

Produce a Repayment Plan

Provide a schedule regarding payments based upon projected business.  This proves you are serious and ready to take on this business venture.  It shows the lender you have thought about how and when payments shall be made establishing positive credibility.  It also opens up a dialogue and allows the two of you to discuss it in precise terms.

These are two ways to help enhance the odds of loan approval.  There are many other requirements to the application process.  If you still are rejected, then check out a business cash advance.  Talk to a professional about what your options are today.

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There are situations where small businesses are rejected for loans but are unsure why this occurs.  It is a frustrating process.  Instead of playing a guessing game regarding what to expect, gather facts about what is questionable to lenders.   It will provide you an opportunity to counteract these questions in a formative, prepared manner.

Selling Essential Technology

When lenders see on paper that you are selling necessary equipment to run your business, they assume the worst.  A lender thinks you are selling it out of need for money.  But what if you are selling it to attain updated and newer technology available to run your business better?  Inform the lender so he/she understands.  A lender will not be able to reach this conclusion solo.  Therefore, you need to be upfront about the purpose of your actions.

Decreasing Sales Numbers

A noticeable drop in sales causes alarms to go off amongst lenders.  Thus, you need to be sure you are able to provide an explanation why it occurred and how you are planning on gaining customers again.  If you do not have a plan mapped out, you may be rejected.

Changing Management

A passing of the guard makes lenders question what is happening with the business.  The lender is going to want an outline of the new management’s background.  Has the person had prior management experience?  What successes has the person developed at past and current positions?  If you are able to prove to the lender that the new person in charge is able to succeed it increases your odds of approval.

Obtaining a small business loan is a tough process only if you do not see things from their perspective.  You need to be prepared to explain your business actions.

If you are still unsure about the process talk to a professional today.  He/she will be able to guide you in the right direction.

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