123ArticleOnline Logo
Welcome to 123ArticleOnline.com!

ALL >> Business >> View Article

Applying For Small Business Loans

By Author: Sia Benet
Total Articles: 44

Lenders are often hesitant to give out SBA loans to small businesses as there is always the risk of loss if the money is not paid back. But, businesses which appear to be promising and can be potential profitable enterprises in the future are more likely to get a loan easily. The business must have a strong personal background and impeccable paperwork to get awarded a loan quickly without much hassle on the borrower’s part. There is a list of things that any lender will look for when you apply for a loan. Knowing these points will help you get small business loans approved easily.

The first thing the lender will look for when you apply for SBA loans is your credit history. This is the record of your previous credits from other lenders, companies or banks. Your credit score will usually be linked to your social security number if it is a personal loan. However, in cases of business loans it will be attached to your tax identification number. Before applying for a loan, you should keep a copy of this record available in hand. Having a clean and perfectly ordered credit record will make the whole process of getting small business loans much easier.

Secondly, the lender of SBA loans will enquire from you about the working capital management and other details about your business plan. The working capital is the amount equal to your current assets minus the liabilities. It is the money readily available to you to keep the business running. If the working capital is too low, the lender might feel that the business is not a viable one and that it is unlikely to make profit. This will discourage the lender to approve your small business loans and thus require you to go through a lot more inconveniences.

The lender of SBA loans will also want to know amount of your own personal investment in the business. This is a way to know how much you have put into your business and whether you really do believe in it. If your personal investment is a huge one, it will show that you believe there is minimal risk of loss in the business and there is a promise of success. This will make it more likely for the lender to approve of your small business loans. Even if you do not have a large capital to start with, lenders usually prefer a small business to have at least 20% of its total investment to be from the owner.

Next, you need to fix on the type of repayment options for SBA loans available to you. You can choose to directly transfer cash from your business or choose any other kind of secondary method of repayment. To judge your ability to repay, the lenders might want to look at your financial statements of the previous year. Even tax returns of the past years show if a business is viable and thriving. If you can show your business has made profits in the past, it will be easier to get a lender to approve your small business loans.
You can now get SBA loans at minimum interest. Find the best lenders of small business loans that will provide a good boost to your enterprise.

Total Views: 50Word Count: 544See All articles From Author

Business Articles

1. Advantages And Disadvantages Of Concrete Staining
Author: Ben Lager

2. What To Look For When Hiring An Ocean Freight Shipping Company
Author: William Santos

3. Top 4 Advantages Of Concrete Coating
Author: Ben Lager

4. Centrifugal Blower Manufacturer In India|centrifugal Blower Fan
Author: sara

5. Building A Modern Architecture Homes- Planning And Concept
Author: Leila Adam

6. Thorough Proofreading Finesses Documents, Raises The Organization’s Reputation
Author: NetZealous LLC, DBA TrainHR

7. Design And Build Contractor Singapore – Get The Best Services From Interior Renovation Contractor!
Author: James Han

8. Meishen–a Bright Star In Magnesium Oxide Industry
Author: hu Allen

9. Grow Customer Base And Market Presence With Pharmacist Email Lists For Your Business Campaign
Author: Adam Tyson

10. Adapt New Forms Of B2b Communication With Infection Control Directors Mailing List
Author: Andrew Rayel

11. Moby Wrap Baby Carrier
Author: babycarriersaustralia21

12. Care For Your Deck
Author: Blue Star Carpentry has been specializing in custom decks for over a decade. When you sit outside wi

13. How Does A Small B2b Company Increase The sales?
Author: Mohit Yadev

14. Latest Job Vacancies In India
Author: careersresults

15. Why Are Aap And Congress Supporters Opposing A Tax Reform Like The Gst? Are They Anti-nationals?
Author: Mohit Yadev

Login To Account
Login Email:
Password:
Forgot Password?
New User?
Sign Up Newsletter
Email Address: