There are many nerve-wracking aspects about venturing into the world of entrepreneurship, but getting your business loan request approved doesn’t have to be one of them. Follow these guidelines to increase your chances of being approved and make the loan process a smooth one.
1.) Do Your Research
Walking into the first bank you see and asking for a loan is probably not the best idea. Check out your local business networking group or Chamber of Commerce to find out which banks have been the most helpful and supportive to other small businesses. Also, be sure the research the type of loan you would like, whether it’s an SBA loan or traditional loan.
2.) Gather Your Documents
Having all the required forms and documentation together will make the application process go much more smoothly. Some examples of forms you will probably need are financial statements, personal credit reports, income and tax records and resumes. Having these all in the same place can make filling out an application quick and simple.
3.) Complete the Loan Application
Don’t wait until you get to the bank to fill out the application. Arriving for your appointment with a completed application and all records in hand will show that you are an organized, prepared candidate and increase the likelihood that you’ll get a business loan. Also, research the process involved with the type of loan you want. SBA loans, for example, have different requirements and entail different forms than traditional loans.
4.) Prepare for Your Interview
While banks are definitely looking at the business you need a loan for, they are also looking at you. Come to your interview well-groomed, polished and confident. Be clear on what you need and your expectations. Don’t ever be elusive when answering questions; banks won’t want to loan money unless they know all the details. Establish exactly what you want to use the money for and how you plan to repay it. Include all of this information in your documentation and be prepared to verify it.
5.) Seek Advice
The best way to know what’s coming is to ask someone who has already been there. Find a local SBA office or development center and ask them any other questions you may have. These experts have most likely been in your shoes before and know what you need to do to be approved for a business loan. Ask for any additional help you may need, such as creating a business plan, evaluating research and preparing financial records. This service is often free and will lend an experienced hand to your loan request.