More Money is the main support you can render to yourself or your business. Whether you are starting a new business or you have already existing business, gathering finance is the major factor more affecting the growth of business.
Many potential business persons find the task very intimidating and get confuse on where to start.
These are the 5 top ways to apply for a business loan.
1. What criteria do bank check for giving small business loan?
Different banks or lending institutions may have different principles in giving out their money, but in overall checking, in order for banks to consider your application form for a small business loan, banks will demand for:
- The loan must be for a good business purpose. The business must be qualified based on size
- You and your partner must have good character; you people must have experience good and personal business credit history.
- Ability to pay back the loan, you must have a reasonable collateral like (personal and business assets)
2. What kind of information will you need?
Different lenders may need some of your documents, but in all you will need
- Personal and business credit history
- Personal guarantee from all key owners of the business
- Strong and detail of business plan (including personal information like bio educational qualification and so on)
- Personal and business financial statements for old and startup businesses and also your project financial statements.
- Cash flow of projects for at least one year and six months.
3. Can you set yourself up from the beginning to make the process simpler (i.e accounting system, records etc)
Get prepared; be careful and also be truthful
- Choose your borrowing institution thorough. Big banks tend to shy away from small loans because it will fetch them big profit. It doesn’t mean that big banks do not give small loan; but it is more difficult for them.
- Go to banks or lending institutions that you have worked with or you are a customer to the company
- Talk to a lending officer and find out the exact documentation they need
- Give them anything they ask of. Some loan applications are not honored because of incomplete application.
Even before you begin gathering and compiling the information needed by the lenders to deliberate on your application, you have to teach yourself regarding personal and business loans so that you can understand and discuss wisely with the lending officers when the time comes.
4. What is the standard size of a personal and small business loan?
Small businesses turn up in so many sizes, a company that start up with one person can grow to hundreds of employee, and their financial needs change accordingly, then standard also changes. In banking industry, the average small business loan depends on the size of the business.
5. Can you get money to start up a business since some banks want to fund growth
Beginning of a business is the most difficult scheme when it comes to secure money. Many startup businesses request money from their family, friends and credit cards. If the credit is good, the business plan will be strong and you will have enough personal resources to put-in and you will also have enough collateral to guarantee you.
Small organization, micro-finance banks, community financial institution and credit union can consider borrowing you money.
Associations that can render help
Are there associations that can render help? Sure there are.
Some of our recommended list of loan organization works nearly with a big network of partners that influence SBA resources and is just a phone call and they will endow a massive help.