As soon as you decide that your business idea is visible, you will need to figure out how you are going to pay for this great idea of yours. Every business large or small needs available funds to operate, whether you’re paying for something new or just expanding into the market, you would require a business loan.There are many sources of business loans. State and local economic development agencies and numerous non-profit organizations provide low interest loans to small businesses who may not qualify for traditional loans by the banks and traditional lenders. When it comes to applying for these loans, the good news is that most of traditional lenders require same information. Obviously each loan program would have specific form that you are required to fill up before you get approved. But for most part, you’ll need to submit the same type of documentation so it’s a good idea to gather what you will need before you proceed to the actual application.
Queries Of Lenders
To prepare for a business loan for your small business you require the Q&A including why you are applying for a loan? How you tend to use the loan in the long run? What assets need to be purchased and who are the suppliers? What other type of business debt do you have? Who are your creditors? Who specifically are the members of your management team? And lastly how strong is your personal back ground?
Importance Of Your Business Credit Report
If you are already in business, you probably know you should be prepared to submit a credit report for your business. As with personal credit report, it is important to review your business credit report before proceeding the application process.
Income Tax Returns
Most traditional lending agencies or local banks require applications submitted with personal and business income tax returns for the previous three years.
Most of the local banks and traditional lenders require business owners with more than a 20 percent stake in business submitted with the fiscal statement. You may also require to provide projected financial statement either as part of or separate from the business plan. Following are the forms required for financial statement.
- Balance sheet
- Income statement
- Cash flow
- Bank statement
Most loan programs require the details of businesses current financial position, the previous position before they began to submit loan application, that would be account receivable and account payable in order to make sure .
Collateral requirement can be different from one lender to another. Some loan program may make you put your property at stake. Strong business plan and financial statement can help you avoid putting up collateral. Your personal or business property may be used to secure a loan
Business Loans By Merchant Advisors
Small businesses can make their business life easier and simpler by relying on Merchant Advisors for business loans, for vast business growth , no collateral, easy and massive cash flow, gigantic magnitude of working capital and a blooming business