How to Increase Your Chances of Getting a New Business Loan
Thinking of getting a business loan but clueless about the process? You’re not the only one. There’s going to be lots of paperwork and computations involved. And then you need to wait for the bank or lender’s decision. Fortunately, the system just got progressive. Now you can have other alternatives that let you get through barriers of tradition. But this is the general picture:
Dealing with Banks
First and foremost, keep in mind that the bank actually wants to give you a loan. They certainly want your application to be successful. Besides, the interest you’ll pay is one of the major ways they make money. But of course, that’s the first thing they want to be absolutely sure of – that you have the capacity to pay. Proving that you can be trusted with a loan after presenting a good business case, is your part in getting a business loan.
As you may already know, there are several requirements for applicants of new business loans, including:
> income statements and balance sheets over the past 24 months;
> updated financial statements;
> a business plan discussing where your business is going; and
> tax returns and bank accounts as backup for your income statements.
Modern Accounting Software
If you have access to modern accounting software, you need not produce any of the mentioned papers. The software will produce all information vital to applications for business startup loans, such as income and expense reports, growth patterns, and forecasts. And if you use software that has been configured with bank feeds (this means your income and expenditure information will be accessible right from your business account/s), the loan officer will find your information even more reliable.
Presenting a Good Business CAse
As we said previously, those who are interested in getting small business startup loans need to convince the bank that their business is worth the gamble. To convince them, you have to be aware of how bank people think. What is risky for them, for example? What makes arguments strong or weak for them? If you know the answers to these questions, you will be able to frame your business story in a way to boosts your odds of obtaining the loan. Asking an accountant for help can be an invaluable step.
Fast Small Business Startup Loans Loans
Finally, there’s a much welcome new kind of lender today that reviews your application online and gives instant access to capital. These lenders basically think more about what could happen to your business in the future instead of what had actually happened in the past. For example, they don’t have to check your credit score. Instead, they will actually study your business with the use of analytical tools, and determine whether or not it will be successful.