For most small business owners, obtaining a loan is the most realistic way to start or grow their company.
Fresno, CA -- (SBWIRE) -- 11/10/2014 -- However, applying for a small business loan is no simple task - it's much more involved than filling out a few forms. Not only will one need a clear plan that demonstrates how one'll pay back the loan, but one'll also need to know how the loan one receive will rank one against other businesses.
Before one start browsing small business loan interest rates online, one should collect some information on one's own company. Not only will this help one avoid unpleasant surprises, but it will increase the chance that one'll get the financing one's business needs.
Understand the Potential Value of one's Business
When one discuss a loan with a potential lender, the loan officer may ask about the value proposition of one's business. A written value proposition is a few sentences or a few paragraphs that clearly states why one's business appeals to consumers when compared to other similar businesses. Being able to clearly articulate why one's business will succeed in the marketplace will make lenders more likely to offer one a loan. Since the heart of most business plans is the value proposition, be prepared to also orally summarize why one's company will succeed.
Collect All of the Required Documentation
While the information lender's request may differ slightly between institutions, there are a few basic documents one will have to add to any loan application. Be prepared to offer a complete financial history of one's business. This financial snapshot should include credit reports, previous years' tax returns, operating budgets and any other information necessary to provide an overall picture of the health of one's business. One should be prepared to present a thorough business plan, and provide cash flow projections for at least one year. This business plan should offer a detailed explanation of how the loan funds will be spent but should also cover the overall health and direction of one's business.
In addition to demonstrating the health of one's business, expect to offer a peek into one's personal finances as well. A good credit report and personal collateral will also help strengthen one's application. Of course, one'll likely be asked to sign a personal guaranty if one are granted the loan. If one intend to use one's small business loan to start one's company, having good personal credit and a strong financial outlook will be essential.
Contact the Small Business Administration
Not only does the Small Business Administration guarantee loans for qualified applicants, but they also provide free counseling to anyone who needs a loan for their business. Once we've collected one's loan documentation, call one's local SBA and ask about available counseling sessions. Participating in an informational session will allow a seasoned professional to examine one's documentation and point out any potential flaws or missing information.
The SBA website is also an excellent place to look for information about writing a business plan and crafting one's value proposition. While one're browsing on the SBA site, think about applying for an SBA loan. If one qualify, one're more likely to get more favorable terms from approved lenders because the SBA guarantees up to 85 percent of each loan. SBA loans also cap guaranty fees and interest rates. Even if one don't qualify for an SBA loan, local SBA offices can often help one find other loan opportunities and classes provided by professional organizations and nonprofits.
Where to Look for Lenders
National banks provide millions of dollars in small business loans each year, but they're only one option available to small business owners. In addition to investigating SBA-guaranteed loans, consider loans from credit unions, community banks, local nonprofits and professional organizations. Lenders with strong ties to one's community will be more likely to loan money to a local business. The loan officers at local lenders are also more likely to understand the unique needs of one's community, which will help them fairly evaluate one's business plan.
Getting a loan for one's small business requires a strong business plan and plenty of organization. Once we've assembled all of the required loan documentation, don't be afraid to solicit feedback on one's business documents before submitting them to lenders. The SBA is a great first choice, but professional organizations and community nonprofits can also help. After we've scrutinized one's application, look for local lenders who will invest in one's chance to succeed.
Understand the value proposition of one's business.
Have these five documents ready: business plan, cash flow projections, personal financial information, business financial information and a personal guaranty.
Explore the resources available from the SBA.
Look locally when shopping for a lender.
About Medical Office Loans
Biz4Loans is a California-based company with an exciting new way of quickly closing commercial loans for businesses small and large. With a customer-centric focus and a high standard for quality service, we embrace new technology to pass cost savings on to our business clients. Entrepreneurship Advocates “Entrepreneurship is living a few years of your life like most people won’t, so that you can spend the rest of your life like most people can’t. “ – Anonymous We believe entrepreneurship to be one of the most rewarding journeys that a person can pursue and that no two entrepreneurs are the same. Some seek a better life for themselves and their families while others take on the risk in pursuit of independence. Whether it is a small town where everyone knows each other or a big city that never sleeps, every community relies on entrepreneurs to create and provide jobs and to usher in new possibilities. At Biz4Loans, we understand the challenges that entreprenuers face in financing their venture. We also understand that a startup entrepreneur frequently has to wear many different hats while her company is getting off the ground. This is why we provide a quick, convenient, and detail-oriented process that achieves results without unnecessary delays or obstacles. Growing the Business Community commercial loan brokers Whether it is financing to cover initial start up costs, purchasing of new equipment for an existing business or an expansion of facilities, Biz4Loans can help. We know that sometimes unexpected costs as well as unexpected opportunities require quick and decisive action. Our ability to quickly close a wide variety of loans has allowed us to build strong relationships based on our reputation for serving our clients effectively. Because of our speed and adaptability, Biz4Loans has brokered over $500 million in funding to businesses ranging from farms, hotels, and non-profits to office buildings, surgical centers and apartment complexes.
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