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How to Secure A Business Loan

Many lenders advertise that all you have to do to get access to their ‘attractive’ loans is a simple application. However, this couldn’t be further from the truth. In reality, while these loans do exist, they are not ‘easy’ to get access to, and you would need a robust plan if you are to secure one without having to pay astronomical interest rates.

The first thing to do is anticipate the need for funds and plan ahead. What this means is that you have to apply for a loan before you actually need that loan. This would ensure that you are already in the process of building relationships with banks and other institutions before you finally ask them for a loan. Doing so would reduce the certainty and help ensure that not only do you get a loan, but get it at a reasonable rate.

Next up, don’t just apply for a loan, but also know what you wish to do with that loan. Any lender would be more eager to lend to a business who knows why it wants the loan, what it wishes to do with it, and how it would help the business grow. Your growth means decreasing risk and increasing business for these lenders and if you are able to illustrate how the loans helps you grow, you are getting in their good books.

To complement the second point, this third point suggest that it seldom ever enough to state that you need the loan for a new restaurant branch if you are unable to prove that there is demand for your food in that particular area. You get the idea – they want to know if you know what you are doing. What you need here is a detailed and robust business plan that highlights all the core areas of your business and shows to the lender what you are really about. From knowing your customers to making a product that is superior to that of the competition, lenders pay close attention to what your business is all about to ascertain whether or not it is safe to lend you the sum.

Lastly, to put simply, show the lender that you can afford the loan you are asking for. To prove this, what you need are up-to-date accounting records that display your financial health to the lender and clearly underlines the profits, revenues, and other details that may be of interest to them. Claiming you will repay the loan by the end of next year is useless if the numbers don’t add up on your statements.

Getting larger loans lead to more thorough and detailed analysis of your business’ viability. However, if your needs are rather short-term, perhaps what you are looking for instead is a cash advance. A large number of providers are now setting up shop to give you access to easily access cash advance. Providers like the First American Merchant are leading the market, helping a large number of small businesses get access to just the cash advance to help their businesses. All they really need from you is a simple application, and you are good to go.