Delancey Street is pleased to offer financing for vape and e-cig shops. We provide merchant cash advances, small business loans, and more, for the industry. We understand the potential in this industry, and provide competitive rates on financing your business – whether it be giving you additional cash, or providing financing for your next real estate purchase.
Bottom line, society is at a turning point. Many people are vaping, and a lot of people are turning to e-cigs as a way to quit smoking cigarettes. While there’s no 100% absolute proof that long term smokers are quitting smoking by transitioning to e-cig/vaping, there’s a huge amount of money going into this industry.
We can help provide financing
With the incredible growth in this industry it’s important for vape shop owners to know they have financing options.
We can help you pay for payroll, by giving business financing to cover your costs. We can even help with inventory for vape stores, by providing different inventory loan options. In addition, we can help you with the expansion and renovation costs your business might have. For example, if you want to purchase another commercial warehouse, or storefront, we can provide a private money loan for it. In some cases, you might need money for marketing costs that are unavoidable. We can provide financing for those costs.
It is usually a feat to get the first loan for your small business. The application process for a business loan can be quite rigorous. Fortunately, the process of deciding to get a loan to actual application serves as an excellent learning opportunity. Given the painstaking task of applying for your first loan, we have put together al the necessary information that you need to have to make the loan application process a lot easier.
Things to know before making an application
Before filling the loan application form, you need to evaluate your options. First, you have to determine if you really need a loan; If you can get the cash you need through other means consider them first. Other forms of financing include angel investment, business credit cards, and invoice financing among others. Look at each type of financing along with its pros and cons. select the option that works best for your business. If you settle on the loan, determine what type of loan that you need for your business. You can go for small business loans products, short-term or long-term loans.
When applying for a loan, you need to be conscious of two main things; your ability to pay the money and your credit rating. These will play a huge role in getting your loan application approved and will be used to determine the terms of the loan.
Credit score analysis
The credit score is the most significant determinant of whether a lender approves or rejects your application. It counts as a measure of trust that you can pay back the amounts loaned to you. Since you are a stranger to the financial institution, it looks at your past and the way you have been paying your bills and loans to determine if it can trust you with their money. The credit score is thus your financial reputation put in numbers.
As a small business, the prospective lender will look at both your business credit score and personal credit score. While there are other areas that the lender will check, your credit score makes for the strongest pillars for or against your loan application.
Business credit score
It is unfortunate that most entrepreneurs often mix their personal cash with business funds especially before the business gets a footing. This overlapping causes lots of financial headaches for the owner later on. It becomes harder for you to file taxes for your business separately or secure a loan. It is advisable that you open a business account from the onset of the business so that you can start building the business credit score early enough. Doing so also protects each side from negative credit ratings on the other account.
Building a business credit rating starts when you start engaging in business transactions. Each of the three reference bureaus calculates the credit scores differently. However each of the looks at your payment history, legal filings and any data about you at the hands of a collection agency. The bottom line is that you must pay your bills on time to build and maintain a healthy credit score for your business.
Personal credit score
The lenders will also look at your personal credit score. This is because the small business has not accumulated a sizable credit history. Much of the loan repayment plan depends on you. However, just like the business credit score, your personal credit rating is affected by the payment of bills and other personal loans. If you pay the bills on time, your credit score goes up. The personal credit score is rated at between 300 and 850 with 850 being the highest. This scale is used in calculating both your Vantage Score and FICO Score.
Mistakes that lower personal and business credit scores
High credit utilization
Credit utilization is the amount of credit that you actually use out of your revolving credit limit. You will be penalized for high credit utilization as it shows that you depend more on loans for your business or personal bills. Your VantageScore is likely to suffer more than FICO due to high credit utilization.
Maintaining a high outstanding balance
You get a low credit score even if you have not missed any payment. This penalty is due to carrying a lot of debt. Try to make as many minimum payments as possible to keep your balances low and escape the penalty.
Ways to improve the credit score before making a loan application
Before working on ways to improve your credit score, you need to have the latest credit report from any of the credit bureaus. The credit reporting law allows you to get one free credit report from each of the three bureaus every year. As for the business credit report, you can visit CreditSignal or Nav website. Once you have your credit report, you can take the steps below to fix your credit score.
Check for inconsistencies
Go through the report while checking for errors. There could be negative entries that are not yours. There could also be positive entries that may not have been included in the report that ought to be there. Report for these anomalies immediately. Contact the credit reference bureau from which you received a credit report.
Look for the past debts that are due
In the report, look for the past debts that may already be due. These late repayments contribute significantly towards the low credit score. Contact the creditors to clear the debts. You may ask some of the creditors to make a goodwill adjustment which involves erasing a late payment entry on your credit report.
Clear tax liens
If you have any tax liens with the state or federal governments, it may be time that you contacted the relevant authorities to come up with a payment plan. You may also clear the liens in a lump sum.
Taking the above steps helps boost your credit score in the short-term which in turn will enable you to make a successful loan application. A small business loan could take your enterprise to the next level.