Running a business can be exciting, but there may come a time when help is necessary. In times like these, it is important to rely on the advice of experienced professionals that are known to be trustworthy. Seedcopa has been helping businesses in Pennsylvania apply for government loans for the past 30 years.
It is difficult to grow profits without hiring staff, opening a new location, or investing in equipment. But you can’t pay for those things without more profit.
Government small business loans could be the answer to this dilemma. For example, the SBA 504 Loan can help businesses buy land, buildings, or equipment, and modernize facilities.
But how do you secure one? Read on for our 4 tips for securing a business loan.
1. Get Documentation In Order
Before you can apply, you’ll need certain documents on hand. Getting them in order is a great way to get the process off to a good start.
- Tax returns for the past three years (both personal and business)
- Income statements, cash flow statements and balance sheets
- New businesses will need a business plan explaining how they want to use the loan
- Personal tax returns and personal financial statements
You should be able to put together these documents with ease. If they are not readily available, take the time to collect them and store them in an organized manner. Reviewing these documents regularly will provide great insight into how the business is doing.
2. Check the Criteria Before Applying
Different lenders have different requirements. Conduct research ahead of time, if possible. Do they have a minimum revenue amount? Does the length of time the business has been open affect the decision?
Find this information out before applying. It’ll save time in case they don’t handle your type of application.
You can also check their criteria around loan size, and what rates they charge.
Some lenders need collateral before they’ll approve a loan. Others will expect you to pay off most of the loan out of personal finances in the event the business can’t.
If you’re not sure where to start, try our loan finder.
3. Tidy Up Personal and Business Credit
Once you’ve got the paperwork in order, check your credit ratings. Make all payments on time, whether that’s for personal expenses or for the business.
You’ll be able to see what lenders will see when they check credit histories. Proving you can handle finances makes it more likely they’ll approve the loan application.
4. Apply for a Loan Before It Is Needed
With careful planning and analysis of your financial records, you should be able to pinpoint in advance when additional funds will be needed to meet the business’ goals.
But remember that the loan process might take longer than you think. Don’t wait until funds are needed to apply.
As long as the minimum borrowing requirements have been met, consider applying earlier than you think is necessary.
Are You Ready to Apply for a Business Loan?
Small business loans can be just the boost your business needs to grow. When structured correctly, you will be able to increase profits and pay back the loan quickly.
Getting documentation in order – including improving the credit reports – will help the application go smoothly.
Once you have done the research, have all of the documentation in order, and have a clear vision for the money, you are ready to apply for a business loan.
Need more information about applying for a business loan? Speak to one of our specialists today.