Small businesses often need to rely on loans to get started or to cover daily expenses such as inventory, rent or payroll while working to take the company to the next level. While a small business loan may be necessary to grow and expand a business, they are not always easy to obtain. Here are a few things a business owner can do to improve the likelihood of an approval.
Be Well-Prepared Before Starting the Application Process
In order to make a good impression in the eyes of a lender, it is best to be fully prepared when applying for a small business loan. Make sure your records are organized so if a bank requests a piece of information, you can provide it in a timely manner. Check your credit score before applying so you can correct any credit errors and maximize your credit score before a bank requests the report. It is also a good idea to do your research on the various loans available to make sure you understand the criteria for such factors as credit score, business duration or annual revenue.
Have a Specific Plan
Regardless of a lender’s criteria, you should first meet with your financial advisor to determine exactly how large of a loan you need, and how large of a payment you can handle, even if you might qualify for more. You will also need a detailed plan for how you will use the money if you want a bank or investor to consider a loan. Some typically acceptable ways to use a small business loan would include inventory purchase, business expansion, administrative expenses and capital investment.
Use a Qualified Attorney
Before entering a legally binding contract that could have a serious impact on your business, you should always consult with an attorney who has experience in business law. They can help educate you on the best loan options available as well as assist and advise you throughout the entire application and closing process. The attorneys at Churchill, Quinn, Richtman & Hamilton, Ltd. have years of business law experience that will be an invaluable resource in obtaining your small business loan. Contact us at 847-223-1500 to learn more.
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