Today will be discussing the process which you must go through to obtain small business loans. First you must qualify as a small business in order to obtain this type of funding. This is generally determined by the amount of revenue which your company receives each year or the number of employees which you employee. Although there is no set rule for all lending institutions generally speaking if you make less than $100,000 each year in revenue or have fewer than 500 employees you are considered to be a small business.
So, how do you go about obtaining small business loans? The first thing you must do is look over your businesses finances to see where you can cut expenses. Having as few expenses as possible is important because banks want to see that you have funds available to pay for the loan plus some extra in case your circumstances change. In essence the last your company costs per month in the more it makes it more likely you are to get funding. In addition to this you’ll want to pull of your business credit report to see if there are any detrimental marks on it. Remember that your businesses credit score is completely separate from your own and functions on a different scale. If you have not used your businesses credit it may be difficult to obtain a loan. One notable exception to this is if your company falls within a certain category of businesses which are deemed to be beneficial to the community. You should contact your local small business administration office to see if you qualify for a guaranteed loan for businesses of this type. Typically this is reserved for companies who provide social services in areas that are hardest hit by the economic downturn.
So if you have your credit score straightened out as well as your expenses you will need to find an appropriate lender. Once again I recommend that you use the small business administration in order to find this funding. They should be able to put you in contact with a lender that will likely approve your company and will walk you through the process every step of the way explaining to you what to expect and also any questions you may have about the loan documentation before you sign anything. You should also seek additional professional assistance when seeking funding so that you can get a second opinion on all of your options.