Business loans are a cornerstone of small business finance, and it is more important than ever to have access to the cash you need to infuse your business with funding for expansion, repairs, updates or for supplementing income when customer traffic is low. Unfortunately, the state of the economy over the past few years has led to more difficulty in finding a small business loan, although there are ways you can increase your chances of getting approved.
Tighter Lending Qualifications
Lenders are picky about who they approve loans for. In 2009 and 2010, unemployment was peaking and businesses were closing on every corner. The Great Recession made lenders more concerned about bankruptcy and small business owners who are unable to repay their debts. Small business loans are typically reserved for businesses that are established and growing.
Before applying for a small business loan, be prepared to provide information about how you intend to spend the money on your business. For example, if you are repairing a major piece of equipment, provide statistics on how valuable the equipment is to your business, and how much more efficient your operations will be if the equipment is working correctly. Similarly, if you intend to use the loan to expand, provide detailed information about how much time you estimate will lapse before you receive your return on your investment.
Find a lender, such as one through UnsecuredBizLoan’s lender matching service, that works with the Small Business Administration to help you get approved for small business loans that you would otherwise not qualify for. The SBA provides government backing to privatized business loans to help small businesses succeed. The SBA itself does not loan money to small businesses, but it is a helpful tool in both establishing and running your small business effectively. Keep in mind, however, that SBA loans often take longer to get approved for, so if you suspect you will need a small business loan in the future, be sure to apply for the money as early as possible.
To apply for funding for your small business, use the form on the right to begin the application process.