Now that you know what lenders are looking for when you apply for a small business loan, and what to have prepared before you apply, it’s time to shop around for the right lender and get your small business loan. Talk to the bank about whether it is experienced with SBA loans and ask if it is part of the SBA Preferred Lender Program (PLP). Know your financial limits; 4. Qualifying for an asset-based loan generally requires a credit score that’s in the 700 to 800 range and up, according to Forbes. On this page. If the term “alternative lender” intimidates you, relax. Wagner's business and marketing articles have appeared in "Home Business Journal," "Nation’s Business," "Emerging Business" and "The Mortgage Press," among others. There are many online scammers, so thoroughly research online lenders. Alternatively, pick a reputable online lender if your credit history isn’t good enough for the bank. Helena Ronis. Nancy Wagner is a marketing strategist and speaker who started writing in 1998. Need money to introduce a new product or service to your business. TransUnion, Equifax, and Experian are three credit-reporting agencies that all offer a free yearly personal credit history report. References. We support America's small businesses. Small businesses can have a tough time getting approved for a traditional loan through a bank. Not having a business plan isn’t an option when applying for small business loans. Microlenders are often nonprofits that issue smaller, short-term loans. Here’s a piece of advice that extends well beyond getting a small business loan: Don’t sign your name to something without reading any applicable terms and conditions first. Banks want to know that their borrowers will use the money wisely. Business plans can be hard to write. If not, list them as trade references. If you don’t know your credit score, the time to find out is now. Each loan requires different documentation and has different requirements, allowing you to choose the one that works best to keep your business going. As part of your business plan, consider why and where you need extra funding. It can take up to 60 days to remove inaccurate information. There are many places you can seek small business loans, but they all offer different terms. Please consider making a contribution to wikiHow today. Instead, you can ask for an increase in the credit limit on one or more cards. Banks won’t offer a small business loan to someone with bad credit. For tips on how to improve your credit score in order to get a business loan, read on! Since microlenders work with people who are newly in business and those with poor credit, they often have a longer application process. Apply for a government-backed Start Up Loan of £500 to £25,000 to start or grow your business. If you really can’t stand to see another ad again, then please consider supporting our work with a contribution to wikiHow. How can I get an investor for a startup business? About 80% of applicants for small business loans are rejected, so don’t be surprised if you get turned down. Add financial data, including profit and loss statements for the past three years, if available. The SBA recommends providing additional documentation as part of your business plan if your credit score is weak or you have experienced bankruptcy. If no lender will give you a loan, consider other forms of funding, such as getting a. Last Updated: July 30, 2020 In the U.S., the interest rate shouldn’t be higher than the maximum allowed in your state, but it should be at least the federal funds rate, which you can find at the IRS website. Request funds to maintain payroll and other regular expenses? No one wants to lend their money to a risky venture, so take the time to flesh out your business plan before going any further. Copyright 2020 Leaf Group Ltd. / Leaf Group Media, All Rights Reserved. She has worked in product and the tech industry for over 8 years, and received her BA from Sapir Academic College in Israel in 2010. Ideally, your financial statements should be audited by a certified public accountant. {"smallUrl":"https:\/\/www.wikihow.com\/images\/thumb\/8\/89\/Get-a-Small-Business-Loan-Step-1-Version-4.jpg\/v4-460px-Get-a-Small-Business-Loan-Step-1-Version-4.jpg","bigUrl":"\/images\/thumb\/8\/89\/Get-a-Small-Business-Loan-Step-1-Version-4.jpg\/aid699885-v4-728px-Get-a-Small-Business-Loan-Step-1-Version-4.jpg","smallWidth":460,"smallHeight":345,"bigWidth":"728","bigHeight":"546","licensing":"