Roughly 24% of business owners say the main reason they don’t apply for a small business loan is that they were afraid they won’t be approved for one.
But how hard is it to get a small business loan, really?
The good news is that small business loan approval rates are higher now than they have been in years — but that doesn’t mean you can afford to ignore the necessary steps to give your application the best possible chance.
So, what do you need to know to make getting a small business loan possible for your company?
Read on to find out.
1. Craft a Detailed Business Plan
Your business plan is absolutely one of the most important things to consider when applying for a small business loan.
This is not the place to make generalized statements nor to be modest about your past work experience and your potential for future success.
A good business plan proves to lenders that you have concrete plans and tiered goals regarding how you’ll use the money from the loan.
Your business plan needs to have a strong analysis of current market conditions in your industry, a marketing strategy, a description of your management team/their qualifications, and a cost breakdown of any inventory, equipment, office space, and other expenses you’ll need.
Most of all, you need to identify your competitors and make estimates about how long it will take you to generate a profit.
2. Know Your Credit and Risk Profile
Next, it’s time to consider your credit and risk profiles.
So, how hard is it to get a small business loan with bad credit?
While certainly not impossible, it is going to make the process much more difficult — and in some cases, the amount you’re approved for much lower.
If you’re among thewith poor credit, you should check your credit report for potential errors, pay down as much of your debt as you can, and avoid applying for any new credit cards.
Lenders will take a look at the total amount of debts from loans, credit cards, and more, and then evaluate that debt against your cash flow and income to ensure you’ll be able to make those payments.
They’ll also look at your past financial records, any current assets the business has, and even any investors you’ve been able to find.
3. Prepare Documents Early
Next, you’ll need to gather the right documents and records as outlined in the small business loan requirements. Having these ready to go speeds up your approval process.
They’ll likely include business and personal tax returns, your income and bank statements, your business licenses, the articles of incorporation, financial projections, a copy of your driver’s license, and more.
4. Select the Right Lender
If you really want to know how to get a small business loan, then understand that choosing the right lender makes all the difference in the world.
Look for a lender that shares your company’s vision and is as committed to your long-term success as you are.
A quality lender is more of a partner in your business and will customize a specific lending package designed to fit your needs.
How Hard Is It to Get a Small Business Loan? With Us, the Process Is Simple
We hope this post has helped you to learn what you can do to get your small business loan approved.
So, how hard is it to get a small business loan approved from us?
At Dealstruck, we work tirelessly to provide you with the best possible solutions within a wide variety of industries, including real estate, oil and gas, restaurants, accounting, and more.
Apply with us today, and make your business dreams come true.