Tips for Getting a Small Business Loan
Accelerate your business growth with a small business loan. Don’t let a cash flow issue stall your startup or prevent your small business from taking the next step. Use these basic tips to get started on your application and grow your business.
How To Qualify
Loan providers for small businesses understand that you won’t have a flawless record or a perfect credit score. However, there are some benchmarks you’ll need to hit to qualify. You’ll typically need to have a reasonable credit score, a few years in business and a personal history form explaining any unusual features in your credit or personal history.
Where To Go
There are many competitive places to turn for a loan. Secure a small business loan by visiting a bank, the Small Business Administration, credit unions or online sources. Each of these sources has slightly different restrictions, features, and benefits, so choose carefully and compare different loan options to find the best source of financing for your situation.
Types of Loans
The type of loans available varies nearly as much as the type of lenders. If you’re choosing a loan from the Small Business Administration, choose a 7(a), 504, micro or disaster loan. Other loan options are focused on a particular type of asset. Select a loan to purchase real estate, equipment or to cover startup costs. Franchises can access funding designed specifically for their type of franchise or for more general franchise use.
Compare types of loans for your particular business plan to get the best terms and conditions. Not all small business loans are available or competitive for your particular financial needs, so be sure you select the ideal type of loan that matches your needs.
Benefits of a Loan
A loan provides you with the cash you need to cover emergency expenses, invest in your future or purchase costly assets you need to grow your business. An emergency expense can cripple a small business that isn’t otherwise prepared with an emergency fund. Investing in your future means paying for marketing, inventory, additional employees or other features that can accelerate business growth.
A small business loan can offer you a great interest rate on flexible financing. Most small business owners are unsure about their next few months or years of expenses, so a flexible loan is critical to cover any unknowns and provide a clear source of financing as you grow your business.