Whether you have been in business for years or are starting a new company, sometimes you need money you don’t readily have for purchases. In these situations, business loans may be the best option to fund the purchase and grow your business. There are many things to consider when applying for a business loan, but these three things are imperative to have before starting the application process.
Three things you need before you apply for a business loan
1. A resume. Applying for a business loan is similar to applying for a job in that it can benefit you to have a resume on hand. Especially if you are applying for a loan that will be used to start a new business, the bank or financial institution wants to make sure that you are capable of running the business properly.
2. A business plan. Next, almost all loan programs require a sound business plan to be submitted with the loan application. The business plan should include financial statements, future projections, and a good marketing plan. While this isn’t tied directly to your business plan, lenders will also obtain a personal credit report as part of the application process. A bad credit report can harm your chances of getting your loan approved.
3. A business credit report. Finally, if you’ve been in business for a while, then you should have a business credit report as well. The business credit report is just like it sounds. It is a report of how your business does financially. This report should also be reviewed before you start applying for business loans.
There are other things to be mindful of when you start applying for business loans, including income tax returns, financial statements, and other legal documents. However, the most important things you need are your resume, business plan, and business credit report.