Applying for a Small Business Loan: 5 Steps to Success

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Applying for a Small Business Loan 5 Steps to
Success
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• Financing is a fact of life for any business,
  whether its to fund a new start-up,
  expand/update your existing business, or solve a
  temporary cash flow issue. The best way to be
  successful in getting that loan is to be prepared
  with all the answers a bank needs to decide in
  your favor.
• Here are 5 suggestions to pave the way to being
  approved for a business loan.

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Research potential lenders online

• Dont just consider large commercial banks.
  Other, possibly easier, options include
• Smaller regional banks
• Credit unions
• Micro-lending organizations
• Online marketplaces

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2. Know your credit history and credit score.

• The lender will definitely be checking to see
  whether you are able to repay their loan. If
  there are any errors or red flags that you can
  fix, get it done before they request the report. 
• Here are some steps you can take
• Pull a fresh credit report online
• Review and challenge discrepancies

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3. Obtain expert advice.

• Theres no point in flying blind when free help
  is available for the asking.
• Consult your trusted advisors
• Speak with fellow business owners
• Check out episodes of Shark Tank. Although the
  Sharks are investors (becoming part owners of
  the business), not lenders, youll get an idea of
  the questions a loan officer might ask you.

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4. Update your financials

• Up-to-date monthly balance sheets and profit
  and loss statements are a great indicator of a
  business financial health. Understanding your
  historical business performance will give your
  lender confidence in your business direction.

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• To demonstrate your credit-worthiness, include
  documentation such as
• Past financial statements
• Assets you will use to secure the loan, such as
  property you own or purchase orders from your
  customers
• Brochure, website link and other marketing
  materials for your products/services

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5. Choosing the right loan vehicle

• In todays every changing business environment,
  there are many types of loans from purchase order
  financing to secured, unsecured, lease or
  purchase. Depending on the type of loan to
  choose varies based on
• Desired end result
• Interest rate importance
• Terms of the loan

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• If you need help putting together the financial
  plan for your loan application, your dedicated
  Xendoo CPA team can provide you with your balance
  sheets, profit and loss statements, tax returns
  and more. Lets get started!