Obtaining small business loans might seem like a formidable challenge, but not if you’re smart going about it. Here are a few tips funding experts offer to help.
Get your financial house in order. – The most important thing you can do is to have everything in order before you even think about applying for small business loans. Different lenders require different info, but they normally want to see many of the same things. You’ll generally need to have ready your personal and business credit history, personal and business financial statements, detailed business plans, cash flow projections going as far out as a year, and personal guaranties from all principal business owners.
Get help. – There are associations out there that can help you get small business loans, believe it or not. The Small Business Administration works closely with a network of different partners that leverage the agency’s resources. Consider reaching out to the SBA Branch Offices, SCORE, Small Business Development Centers, or Women’s Business Centers.
Shop around for loans. – Who said you had to focus all of your efforts on one single lender? Shopping around for financing might seem like extra work, but it can pay off in the long run. Don’t assume the one bank or vendor you have in mind will offer the best terms. Get different established financing providers’ rates, lease terms, fees, and options. You should also consider staying local. National banks are less likely to hear you out if your starting up or if your business hasn’t been doing well.
Whether you’re going after secured business loans or unsecured business loans, you need to have your financial house in order, get help, and shop around for lenders. Once you’ve done that, you’ll find that you’re in the best position possible to get a small business loan.
If you have any questions or have any other tips to help others, feel free to share in the comments.