Applying for a loan to start a business needs more planning and preparation compared to other small business loans. In this article, you will get what all you need to prepare before applying for a loan and what are the options available.
Some of the decisions that you need to make before starting the preparation are:
- How much loan amount do you need?
- Can you repay the loan?
- How much time will you take to repay the loan?
- Can you provide collateral to the lender?
Preparation for getting a small business loan for starting a new business
Prepare a business plan: Some online loan lenders require a business plan that shows the plans and goals, future growth of your business. It can include a description of your business, product/service that your business will offer, industry analysis, facilities, and operational plan, sales strategy, SWOT analysis, etc.
Prepare important documents: Following are the documents that you need to prepare:
- Bank statements
- Tax returns
- Credit score
- Copy of your ID’s
- Business licenses
- Business Plan
Improve your credit score: A credit score can be an important factor when you are going for small business loans to start a business. You can check your credit score online. A credit score above 622 is considered good in Australia. Pineapple funding provides service for improving your credit score, check here: https://www.pineapplefunding.com.au/our-services/
Equipment Loans: Equipment financing is a loan option for purchasing new equipment for business needs. This type of loan can fund you 100% of the cost of the new equipment.
Business Line of Credit: Line of credit allows a flexible funding option up to a certain amount and whenever required. Business with low cash flow and changing needs of money are best suitable for this type of loan. Credit score requirement for getting a business line of credit can range from low to high credit scores.
Credit Card Loans: Business credit card is also a good option for getting cash when you are ready to start a new business. Business credit cards are solely used for fulfilling the business’s cash needs.
Invoice Financing: Invoice financing or factoring is not a type of loan but advance money of up to 80% of the amount due on your invoices. Lenders will get payments when you get paid from your customers. This type of funding option is suitable for manufacturers, wholesalers, importers and other service industries.
Hey, so are you ready to start? Contact us for getting small business loans to start a business. You can call or email us in case you have any queries.