You have your business concept. You’ve figured out your business structure and have registered your business tax ID. Now you’re ready to take the world by storm and get approved for funding to sustain and grow your business. So what do you need to increase your chances of approval for business loans and other lending products?
Create a Business Plan
For SBA loans and other conventional lending solutions, lenders want something a bit more tangible than an elevator pitch on how great your business is. They want a formal business plan, complete with projections, an analysis of direct competition, forecasts on profitability versus overhead costs, and more. The more detailed your business plan, the more likely lenders will approve you for financing. There are free online resources for entrepreneurs to download business plan templates to streamline the process. Keep in mind that your business plan is not set in stone, but a guideline to show lenders your intent. No matter what happens, it’s still a smart move to show some sort of plan for the uncertainty of the future.
Get a Credit Report
For many business financing solutions, lenders are going to look at the credit report for your business. In the case of new or emerging businesses, lenders will want a personal credit report as well, to get a better understanding of your financial situation. Credit reports should have as few red flags as possible. The best approach is to go over both your business and personal credit reports with a fine-toothed comb and remove anything that might make lenders wary. Any changes will show up a month later, so the best practice is to review credit reports well in advance of any financing applications.
Review Your Business Finances
For certain lending programs, such as merchant cash advances or equipment financing and leasing, your lender will want to see your business’s finances. These typically consist of a balance sheet, income statement, and cash flow statement. These items help lenders calculate the risk involves in approving financing for your business as well as the total amount of financing your business will receive. Keep your financial records up-to-date so you can give lenders the most recent information when you apply for financing.
Find the Right Lender for Your Business
Not all lenders are the same. Some only deal with well-established businesses and have high requirements. Other lenders only handle traditional loans. Ideally, new and small business owners should seek out a lender who offers a wide range of solutions and who will listen to you to understand your business needs and goals. Web Finance Direct works with small business owners to offer accessible financing solutions for equipment, cash flow, working capital, and more. We understand that each business is different, and tailor solutions to meet the requirements of our clients. Contact Web Finance Direct today and get the right financing for your business.