What to Know About Getting Your First Business Loan

Here are tips that you should know before applying for a working capital business or getting a working capital loan for startups. These tips will take you far, as a little knowledge generally can take us an extremely long way.  

  1. Be an amazing storyteller.  

It sounds old and trite but being confident and an exuding bit of braggadocious is exactly what will catch the attention of lenders.  Lenders’ primary concern is being able to be confident in our ability to repay the money that we are being loaned. The onus of proof lies with us.  We must demonstrate to potential funders that we will be able to bring in the necessary profits. A clear and distinct business plan is one of the first steps toward achieving this goal.   Also, be prepared for the process to be more involved than initially anticipated. Lenders have high expectations and even higher standards. It is important to be able to provide any additional information and even collateral.

  1. Consult an accountant.

Many small businesses do not have an on-call accountant but even if its Uncle Melvin who is a retired CPA, ask for some advice especially with a first-time business loan.  Accountants are a good investment in the future success of our companies. Even simply hiring one as needed is a good idea. A three-year projector is a solid place to start for a burgeoning company.  An accountant can clarify any questions you have and help to further develop your business plan into a mogul model.

  1. Build your credit.  

For a small business, getting a small working capital business loan can help demonstrate that we are capable of repaying any loan that is received.  It is a chance to demonstrate a good payment history and to build a strong credit history with the lender. Building a good relationship and having a good rapport with the lender is also a good way to attain a bit of a foothold.  Be open to any questions about credit and payment history and most of all, be friendly. Building a good relationship with lenders and banks is just as important as building a strong credit rating. Your lender will also be a viable source for information and resources regarding more capital and just general good business acumen.



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