As a small business owner, you have a lot of responsibilities. One of these is finding the right source of funding for your upcoming projects and overall business growth. Small business loans are one of many ways to get your business the funding it needs to move forward.
Delancey Street offers all kinds of financial products including merchant cash advances, small business loans, and business lines of credit. Business loans are available for all business types, regardless of industry, and are given in amounts up to two million dollars. With these types of loans, you can expect…
- Moldable Repayment Plans To Fit Your Needs
- A Quick Approval Process
- Funding In As Little As Two Business Days
- No Limitations On How You Can Spend The Money
- Bad Credit Acceptance
As you can see, there are many advantages to getting a small business loan with Delancey Street. However, before you run off and apply for a loan, it’s important to ensure that your business is in need of a small business loan and not another form of financing. Each business goes through its own growth cycles and undertaking a repayment plan for a business loan is something that you must consider to ensure that you will be able to comfortably repay the debt at this point.
Filling out an application is not the first place that you need to start when thinking about a small business loan. In fact, applying for a loan should be the last step that you perform. Let’s take a look at the other necessary steps you need to undertake before even filling out an application.
1.) Pull Your Credit Score – Since loan approval is highly based on your credit scores, it’s very important that you understand what those are. For a small business loan, both your personal credit score and the business’s credit score will be evaluated. You can get copies of these at the online credit bureau websites for the respective credit score.
Take a look at where your scores are compared to the indexing scales, which you can also find a slew of online resources explaining. Those with a good to great credit score have proven that they can successfully manage their finances. They’re more likely to completely pay back the loan without defaulting. For this reason, those with a good to great credit score are going to receive the best loan terms and rates available.
Those with lower credit scores won’t have access to the best loan terms as they’ve shown through their past credit history that they’re not responsible when it comes to managing their finances. These borrowers possess a higher risk of defaulting on the loan than those with higher credit scores. For this reason, these borrowers, if approved for a small business loan, will receive higher interest rates on their loan. If your credit score is currently on the lower end of the scale, you may want to invest some time in improving your credit score before applying for a loan. This will give you a chance to scoop up the best loan terms possible.
2.) Gather Your Financial Statements – You will be required to submit financial statements to your lender when applying for a small business loan. These statements give a snapshot of how the business’s finances are handled and the overall financial health of the entity. Common documents you’ll be asked to supply include, but are not limited to, a balance sheet, income statement, and cash flow statement. It’s a good idea to get these ready ahead of time so that you can submit them along with the application for a fast approval process.
3.) Understand The Purpose Of The Loan – While every business owner could enjoy having some more capital to play with, it’s never a good idea to just apply for a random loan without having a purpose. You should clearly know what the loan is going to be used for. When you know exactly what you’re going to be doing with the money, it goes a long way in convincing the lender to lend you the money to do so.