Applying for a business loan can be extremely challenging. But the most sought-after means, loan approval from commercial finance providers depends on their confidence that you are capable of repaying the amount that your plan to borrow from them to use for your business.
If you think that you need some help in boosting your chances of getting a business loan approval from finance providers, here is a list of simple tasks that you must do before submitting your application for funding, to increase the trust of these institutions in your repayment capabilities.
#1: Strengthen Your Business Plan
While some commercial finance providers do not require loan applicants to include a business plan in their application, it would be wise to take the initiative of providing the lender with an executive summary of your business when filing for a loan. Aside from proving that you are organised, responsible, and well prepared, showing the lenders your solid business plan will let them know why you need to file a loan and how it can help your business.
Always be specific when making a business plan. Explain what your company usually does, how it generates revenue, and why your target customers will invest in your products or services. Take advantage of your business plan and use it as a tool to persuade the lenders that you have an outstanding business idea and determine how to implement it to turn it into a success.
#2: Evaluate Your Credit History
All lenders check the credit scores to help them figure out if you and your business are qualified for a loan. Since they want to know that you can repay the loan on time, you need to prove that you have reliable business and personal credit scores.
Before filing for a loan, you must carefully evaluate your business and personal credit scores to ensure that everything is accurate. If there are any types of discrepancies, you have to dispute them right away. You may also improve your credit score by always making payments on time.
#3: Simplify Your Financial Records
Lenders will most likely scrutinise your company’s accounting records and financial statements thoroughly when you file for a business loan. It is the reason why you must ensure that all your company’s balance sheets, cash flow, income, and loss statements are accurate, complete, and simple to digest.
Aside from making sure that your financial statements are in order by taking care of it by yourself, it would also help if you have a certified public accountant on board so they can evaluate your records before sending your loan application.
#4: Check Out Your Online Presence
Since commercial finance providers always make sure that they perform due diligence while going through the approval process, you may expect to see them reviewing every possible information posted in public about your company. So ensure that all the components of your website are up to date. The web design must look as professional as possible.
You must also look back on your company’s online presence, particularly on your social media accounts like Facebook, Twitter, and LinkedIn, to know if you need to delete something that could affect your approval.
It is also important to look for the right commercial finance providers for your business loan. Learn the kind of common business tactics that would work for your needs to boost your approval chances.