Sometimes a business needs loan to carry on to the height it should be. In this article today we shall see how to secure a business Loan.
A business Loan will be needed to buy the necessary business equipment and all things the business needs to run on.
There are so many criteria you need to meet before securing any business Loan from a bank. This article- How to secure a business Loan- has been prepared just for you to know how to get one and expand your business.
Business loans can be very difficult for small or new businesses to obtain but we will shall see how to secure a business loan even for a small or new business.
It takes more than just an ambition to make your business a reality. You need money to make it come true. This is why this article is prepared just for you to know what matters and how to actually get the cash through loan to start or expand your business.
Don’t stick to one place for a business Loan
When looking to secure a business Loan, check more banks or lenders to compare their loan terms. Your banks will be a great place to start. Even if you are okay by their Loan terms, check other places too.
Consider how much percentage you will pay back and the time of paying back. If you are not comfortable with one try another till you find or get a better place to go by.
Why you should obtain a business Loan
Some steps are taken in business for some reasons. Taking a blind step or a decision in business can be very fatal to the business success. In this section we shall see reasons to take a business Loans.
If you see indeed that your business doesn’t need financing at the moment then it is better to stop considering taking Loans for now until you really need it.
1. You want acquire new equipment
Businesses run on the backs of equipment. Getting a new equipment for your businesses might sometimes require you take a loan to be able to solve that problem.
You might need the equipment to enhance the production or services part of your business.
Whichever way, taking a business Loan can never be overemphasised.
2. You want to expand your business
A business Loan might be needed to make sure a business’ physical location is expanded.
The need for expansion might mean that business is growing and the initial place cannot hold the business anymore. This will surely call for an expansion.
The sign that business is going and growing does not mean you will always the money in your hands to execute the projects you need to do.
Taking a business should come to mind in this situation.
3. Adding working capital
Working capital is the amount of money needed to run the day-to-day operations of the business.
If a business is expanding, it might need more people on board to help carry out the increasing functions in the business which will mean the need for more money into the business.
Ways on how to secure a business Loan
You need money to get your small business from off the ground, but most banks grant loans to businesses with 2-3 years of track record.
Don’t worry you will see how to secure a business loan for your small business in this post today.
You need also know how to choose the best lenders before taking a business Loan.
1. Have a good business Plan in place
A good number of banks ask for a business plan before considering giving businesses Loan.
A business plan must not be a very bulky document or something that looks like a university textbook. It can be a one paged document.
All banks are looking for is the executive summary, financial projections and the important parts of the business plan.
So many business owners fail to secure a business loan because they don’t know how to write a business plan.
Also read: How to write a business proposal
2. You need have a Collateral
Banks when giving out loan check to see what assets you have on ground to cover the loan if you fail to pay back.
Having an asset to serve as collateral will boast your chances of securing a loan from the banks.
Also read: How to start mini importation
3. Getting the right papers
Aside bring your business plan to the table; you need to have other necessary documents in place. Having the documents in place will as well give you more chance of getting the loan to expand your business.
Bank statements, tax returns, letters of incorporation, business insurance, trademark registration and other business licences they might require.
4. Discuss the numbers
In the process of trying to secure a business loan you have be ready to discuss the numbers with the banks.
By numbers I mean your cash flow and the revenue you expect to generate. They will be interested in how you are tracking your revenue stream.
Hope you have received a great value for reading this blog today.
Hoping to see you come back and read more.
Don’t forget to share with Family and Friends………….