Things to remember when applying business loans..?

Discussion in 'Growing and Managing a Business' started by williamjames732, Jun 3, 2013.

  1. williamjames732

    williamjames732
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    Hello all,

    We all know that getting business loans is not an easy task now. So please share some of the best tips to get into business fast.


    Thanks
     
    #1 williamjames732, Jun 3, 2013
    Last edited: Jun 3, 2013
  2. Rocky

    Rocky
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    One important thing you need to keep in mind is have a good business plan ready with all the fund flow estimates that would indicate the viability of your business and influence the loan.
     
  3. Fergal

    Fergal
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    The most important thing to be able to do is convince the lender that you will be able to pay the loan back. This requires you to give evidence that you are trustworthy and that the business will be profitable enough to make the loan repayments.
     
  4. williamjames732

    williamjames732
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    Is it Personal credit report is also matter..? If yes what will be the perfect credit score to get business loans..?
     
  5. deliah

    deliah
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    Yes your personal credit score can be taken in to account as it can take a long time for your businesses credit score to become fully seperated from your personal credit. If your personal finances are poor then it can affect your business finances and your ability to secure a loan. Always establish seperate business accounts to help seperate the two. There is some info here on business loans and other options available
     
  6. williamjames732

    williamjames732
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    Thanks for your advice Deliah!!

    One more thing I know is how can I secure business loans from SBA..? Please share some tips to get business loans from SBA.

    Thanks
     
  7. kewalkhanna

    kewalkhanna
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    WOW!!! you have started a great thread which is very useful to those who wants to take loan for their business. Yeah agree with your point that getting business loans is not an easy task. First thing you have to remember that mostly lenders will look at your credit history prior to making a decision, so keep an eye on your credit score. You have to make sure that you can repay the loan.
     
  8. williamjames732

    williamjames732
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    @kewalkhanna

    So, how can I maintain a good credit report. If you can share some tips that help me more..

    Thanks
     
  9. scottbaird

    scottbaird
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    I agree with you that getting a loan is not an easy task but nowadays there are lot of banks and companies who gives loans for business on less interest rate and in less time. Before apply loan you must insure to start a business or make a proper business plans like what business you want to start and what is the budget of your business and many more things related to business that you need to remember.
     
  10. alicemenezes

    alicemenezes
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    First create a full proof plan to present to your loaners
     
  11. Business Attorney

    Business Attorney
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    A solid business plan with reasonable revenue projections that you can defend in a face-to-face meeting with the lender. You need to understand the financials completely. That means not just the totals but the individual components. Depending on the type of business, that could mean raw material costs, direct labor, selling and administrative costs, interest and financing costs, etc... And you have to understand not only the numbers on your projections but also the ratios and what might cause the actual numbers to be higher or lower. I've sat through presentations where the entrepreneur didn't understand that if his sales were at 90% of his projections, he went from being highly profitable to a negative situation.

    Also, you need to have some evidence that there is a market for your product or service. "If you build it, he will come" may have worked in the movie Field of Dreams, but most lenders want something more substantial than your unbridled optimism. You also need a marketing plan to show the lender how you will convert the potential market into actual customers.
     
  12. platnumcn

    platnumcn
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    I believe all your papers should be in the right shape, especially your business plan. The profit projections should be such that the lender will not have any question in his mind about his money going down the barrel. Again, you should make sure that your credit score is good too. This is something, which might block you from getting a good deal.
     
  13. RevaxMedia

    RevaxMedia
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    The very first thing you should consider is if you actually need it as this is a big commitment and it may not be in the future businesses best interest to have such a large burden of debt hanging over it at such an early stage. From there just make sure you have done your research as your bank manager will have loads of questions to make sure you are a sound investment.
     
  14. williamjames732

    williamjames732
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    Thanks for your advice RevaxMedia!! Ya It is very Important to the get business loan you have to impress Bank manager, After all he takes the final decision !!
     
  15. J.Rod

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    Preparing your accounting/transaction record is also necessary. It can help the lender to decide whether he'd grant you a loan or not.
     

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