3 steps to know if you are eligible for a small business loan

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Getting a loan for a small business takes a long time. But if you qualify for a small business loan, you’ll save yourself a lot of hassle and time.

In most cases, when you apply for a loan, your lender will have pre-approved you, meaning they know exactly how much money they will lend you before you even complete the application process with them.

Then you can start thinking about what types of products/services you would like to buy, who you might sell them to and where you would like to set up shop.

This also saves you the time of writing all your down payments and closing costs on paper.

small business loan

Here are three simple steps that will help you identify whether or not you qualify for a small business loan.

1) Credit scores and personal liability

Personal responsibility e good credit scores help identify whether you are eligible for a loan or not. Establishing good credit is one of the first steps in getting a mortgage or loan from a bank or other lender.

These include personal loans, auto loans, small business loans, home improvement loans, etc. So it’s important to monitor your credit history regularly to make sure you’re doing everything you can to maintain its good reputation.

2) Financial and legal documents

When you apply for a small business loanmake sure you have gathered all the important and sufficient legal documents needed to apply to your bank or financial institution of choice.

Whether it’s your SBA 504/7(a) return, pay stubs, tax returns (income and expenses), insurance returns, bank accounts.

Make sure there are no problem background check on any individual loan company or officer handling your case.

3) Strong business plan

Having a strong business plan it is crucial to qualify for any small business loan. However, this document can also help you determine the feasibility of your ideas and plans, especially with regards to how much money it will take to get off the ground and make it big.

Use this credit calculator to help plan your repayments:

How to get a small business loan without personal collateral

small business loan without personal guarantee

Companies always consider getting a small business loan. But before you go to a lender and apply, you’ll need to consider whether you’ll need a personal guarantee to secure the loan.

This article was published by: Harrison Butler by title: 3 steps to know if you are eligible for a small business loan

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