Step-by-Step Guide to Getting A Business Loan

A business loan can help you access the funds you require to start your business or expand it. However, the process of applying for a business loan can be pretty intimidating if you’re unsure how to get started. That’s why this article lists a few easy and manageable steps that can help you navigate the process with ease and secure the funds you need. Here’s what you need to do to get a business loan.

Decide What Kind of Business Loan to Get

There are numerous types of business loans. Some are ideal for startups, while other loans are helpful for businesses that just need a line of credit to manage their day-to-day expenses. So, before you approach a lender, make sure to assess your company’s financial needs and work out what type of business loan would be best.

Check if You Qualify for A Business Loan

Answering the questions mentioned below can help you determine if you qualify for a business loan:

What’s your credit score?

If you really want to boost your chances of getting a low-rate business loan, you need to have a credit score over 680.

How long have you been running your business?

Most lenders will require you to have been in business for a minimum of 12 months to qualify for a small-business loan. If you’re looking to apply for other types of business loans, your business should be at least two years old.

How much money do you make?

Lenders will need you to have earned a certain minimum annual revenue in the past to qualify for a business loan. This annual revenue can range anywhere between $50,000 and $250,000.

Compare Lenders

There are three primary types of lenders you can consider: banks, online lenders, and non-profit microlenders. Each type of lender will typically have numerous products, and one of these products may be better than the others for your situation. So make sure to compare the different options available to you and pick a business loan with the best rate as well as terms and conditions.