Getting a business loan is not as easy as it may sound. You need to know what you want and how to express your needs. There are many different companies trying to get business loans today. Follow our advice to get what you want.
Before you start heading out to banks, consult with small business resources in your community, like the Small Business Development Center (SBDC). These establishments can help you seek funding through debt financing. They can tell you how to approach lenders and which banks to approach. You really need to know what lenders need before making a big move. In general, lenders consider four factors: your ability to repay the loan, your business experience, your character, and your collateral and personal guarantee. Make sure that you prepare necessary documents to the best of your abilities. You will need a business plan, cash-flow statement, income statement, personal and business tax returns, balance sheet, personal financial statements, as well as a description of the terms and loan amount. This includes how the business loan will be used and repaid. It is always a good idea to give the lender your business. Thus, transfer your personal and business accounts to the bank. Show your character to the bank by getting to know the staff. This helps on getting a loan and navigating through tough times in the future.
Once you have done your research and paperwork, you need to make your pitch to the bank. If you have a mentor, make sure you present to him or her first as practice. Feel free to take your mentor along with you for the actual presentation. It may make a difference in your getting the business loan. If you get turned down for the loan, meet with other banks until you find the right match. Look around for other financing options, as well.