Before you get the loan: 3 things to prepare

While loans for small businesses can be instrumental in helping launch new ventures, owners have to think carefully before they decide to pursue one. Reviewing your materials beforehand will make it more likely that you obtain the capital you need for successful funding. What’s more, loan consultants will give you the knowledge necessary to make more informed funding decisions, given the amount of different loans available.

Collateral, among other things, can reassure lenders during the loan application process.

For a better experience applying for—and hopefully being awarded—a loan, determine whether the following materials are in order:

• A strong proposal: You don’t have to get this in writing, but it could help to have a firm idea of what the loan will be used for once acquired and how it fits into your existing strategy. This can include a timeline for execution.
• Collateral: As Janelle Witting says in a piece for Michipreneur, collateral is essential for convincing lenders to approve. “Lenders may hesitate to lend to a startup, but if you can make a solid business case for your need and demonstrate that you have the ability to pay it back, you have a higher chance of approval,” Witting writes.
• Credit score: This is another deciding factor for many lenders, and knowing yours will help you predict what the response is when you apply for a loan. An article in Forbes suggests the ideal credit score as between 700-800 to impress most lenders, although lower ones can still qualify.

Business development consulting specialists will help owners reach their goals through local loans. Growth Capital provides access to such programs as the SBA 504, Ohio Regional 166 and Community Advantage. Visit our site to learn more.