There are many reasons why you could apply for a business loan. A major one could be seeing a growth opportunity that required additional funds. That strategy is usually adopted by small businesses in their early growth phase. Then as the business grows, it will be able to sustain itself and pay back that investment. Additionally, several businesses apply for business loans to be able to purchase new equipment or inventory. And when the cashflow is poorly managed, this can break the business, which is why many business owners opt for a business loan to save their business.
There are important criteria you need to pay attention to when applying for a business loan in order to get approved. It’s different for every business loan provider. For instance, some business loan providers require a minimum turnover of £50,000, others require a turnover of £120,000. Additionally, you would be surprised to find out that some business loans do not have a minimum required turnover. The amounts provided by business loan lenders begin at £1,000 and could reach up to £500,000! The key when applying is to have all your documents and financial statements organised and ready. Having professional accountants by your side increases the chances of getting approved for the business loan.
For starters, you need to check your business’s credit reports and provide an accurate and timely report of your business’s credit score. This is an important component, and sometimes it is what approves one business over another. If you do not have a good business credit score, it’s worth exploring ways to improve it before you apply for a business loan.
Are your finances in order? You need to ensure that all your outstanding debts are settled. This can drastically impact your chances of getting approved for a business loan. During the application process, you may be required to provide the business loan lender with your latest financial statements. Here, your accountant can help you provide accurate and readable reports for your application.
Moreover, you need to have a plan. You can’t just apply for a business loan because you want to do so. It would be beneficial to provide a detailed plan of how much you are applying for and where these funds will go. Finally, when considering business finance options, don’t forget to compare the options available when it comes to interest rates and fees.
Do you want to apply for business loans? Get in touch with us right now! We will help you be prepared and ensure you are confident in your choice of business finance. We want you to know that it’s never too late to Rewire Your Business for Success.
