Scene one: you are sitting on your office desk surrounded with
files and work overload, you are thoroughly frustrated. You work hard
and get paid. But somewhere something is lacking.
Scene two: you
work for yourself; you do what you want to do. You work hard and you are
satisfied. You go home a better person each day cause you work for
yourself. And you definitely earn more.
You don't even have to
look at the results; votes for Scene two are definitely more. You want a
life like that. But every business entails capital. Small business
loans can accrue the capital you need to start a small business. With
so many online sources for small business loans, you don't need to rely
on family or relatives for capital.
Homework! Yes, it is not meant
for school kids only. You too have to do it, to find the right resource
of your small business loans. There are a few points, the loans lender
will be looking at, when he is contemplating providing you small
business loans. A lender will be paying attention on your education,
experience, business plan and its feasibility. Other things that are
crucial are repaying ability, credit history, equity, presence of
collateral.
The first things will be your ability to repay. Every
loan is meant to be repaid. Loan lender wants his money back. They will
look for a business that has existed for some years now. If you are
starting a new business, prepare an application that will prove to them
that you will repay the loan. If your business is low risk proposal, you
are getting a small business loans.
Presence of collateral would
provide a positive boost to your small business loan application. The
financial institution would be looking for an alternative source to
payback the loan. Without collateral, you would need a cosigner who can
pledge collateral. Collateral can be any business or personal assets
that can be sold to pay for the small business loan. The market value of
collateral is not taken into account but the value which results after
negating the valued lost when the collateral is liquidated.
Equity
is also significant. The equity will be in the form of money you invest
in your business. The loan lender will be very pleased to know, if you
have invested your money in the business. If there is enough equity in
your business to payback the loan, the small business loan will be
yours.
The next crucial thing will be called a credit report. If
your credit report is good, your small business loan application will be
reaching the top of the application pile. If you have no idea what your
history reveal for you - get a copy of credit report. Make sure the
details given there are correct. In case there is an error, get it
corrected before you apply for small business loans. Pay all the pending
debts and get going.
The question that you will be facing with
small business loans is what you are going to do with the money. Give
concrete answers. Convince the lender that you will repay the small
business loan with long term profitability that your plan ensures. Your
confidence will be a key to unlocking small business loans.
Small business loans are available in three forms -
Short term loans will solve funds problem for immediate business starting. Their term is usually one year or less.
Intermediate loans are meant for large initial expenses with loan term between one to three years
Long term loans supply for initial costs of a start up business and extends from three to seven years.
Documentation!
Yes, just get ready with your file of documents and make sure it has -
proof of ownership, letters of reference, contracts, tax returns,
financial statements, credit references, Incorporation or LLC
organizational documents. The loan lender might ask for any other
documentation for
Read
the small business loan agreement carefully and have your lawyer review
it. Some terms can be negotiated with the loan lender. If your
circumstances are favourble, you can even manage to waive some terms.
Obtain terms which you are comfortable especially with regard to
repayment process and interest rates.
You can have a great idea,
great people to work with, a well written business plan - everything,
almost everything. All you need is a small business loan to make it a
success. So, how do we begin writing the success story? With writing
small business loans application.
No comments:
Post a Comment