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Five Business Loan Myths, Busted

Whether you’re a startup seeking finance, or a business wanting a cash injection for rapid growth, loans are a fantastic way of gaining the money you desire. Instead of needing to scrimp and save over an extended period of time, a loan will ensure you can expand your business at a much faster rate.  

Sadly, there are numerous myths floating around that scare business owners from exploring the possibility of a loan. You might have seen one or two in the past and opted against applying for this type of financing.

Well, this article is here to dispel the myths and show that a business loan is, in fact, a great option for your company’s financing needs.

Myth #1: It’s incredibly difficult to get a business loan

Wrong. While there is a reputation that you have to jump through numerous hoops before you can even get close to a business loan, it’s not that challenging to acquire one. There’s just one main element you require: preparation.

As long as your books and documents are in order, and a lender is confident that your debts will be paid on time, then you are on the road to a financially easy street.

Myth #2: A bank is your only option

Back in the day, the only method of securing a business loan would be through a bank. Nowadays, there are various options available for you to get the financing you desire. This is good because banks, while still reliable, are notorious for their restraint in approving loan requests.

As a result, lenders such as are becoming more and more popular with businesses. Along with offering business loans at competitive rates, they are typically more open to approving applications.

Myth #3: A perfect credit rating is needed

It’s true that a strong credit rating is helpful when landing a business loan. It’s beneficial for getting a low interest rate and a bigger loan amount for instance. However, even those with a bad credit rating will be assisted by certain lenders. The options might be more limited and less valuable, but it demonstrates that a perfect credit rating isn’t necessary.

Myth #4: Business loans are only available to startups

It was already spotlighted in the opening sentence of this article, but business loans are not only exclusive to startups. After all, there are various reasons why you may require a quick injection of cash.

For instance, you might want to secure a business loan to cover any tax expenses. If you’re a larger organization looking to begin a building project, you could even land a seven-figure commercial real estate loan.

Myth #5: Receiving a business loan can take forever

Depending on the lender that you go with, you could actually receive your loan within 72 hours. That’s not exactly “forever”, is it?

There are factors that can come into play when it comes to the speed of the loan process. If you have all relevant documents ready to go, a well-developed business plan, and solid credit score, this will go a long way to quickly securing your business loan.

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