Before you apply for a business loan be prepared to have your credit and finances in order. However, lenders are very flexible these days and some may only require your income to qualify and others lend based on your credit.
When is the best time to apply for a business loan?
Honestly before you actually need it. You may need to:
And you may need to work on these two items first. If you need help click here to watch a short informational video.
Then Find out how much you qualify for and analyze your plan to see if your offer is a good fit.
What You Need to Know before you accept An offer
Before you accept an offer for a business loan, make sure that you understand all the terms and conditions associated with it. The terms and conditions are important because they will tell you what to expect and the rules you must follow.
the most important terms and conditions associated with business loans are:
1. Interest Rate
2. Term of Loan
3. Annual Percentage Rate
4. Maximum Amount
5. Prepayment Penalties
6. Default Rates
7. Minimum Balance Requirement
8. Lien Priority
9. Loan Insurance
10. Security Interests
11. Other Terms and Conditions
Types of Business Loans
There are many types of business loans. Some of these are:
- Commercial Real Estate (CRE) Loans
- Business Line Of Credit
- Unsecured Business Loans
- Equipment Loans & Leases
- Commercial Lease Financing
- Working Capital Financing
There are some situations when you should apply for a business loan
For example, if you are planning to buy a new office building, then it is a good idea to apply for a business loan before buying the building the same as you would when buying a house.
You can also apply for a business loan if you want to:
- Buy or lease a new car
- Buy or rent furniture for your office
- Buy or build a house
You will want to speak with your tax professional on the tax benefits of these types of purchases.
One Important Note To Remember:
The names listed on your Corporate Articles especially the ones who have 20-25% ownership they will have to sign and most times be apart of the qualifying process on any business loan.
Business loans are great way to finance your business and commercial real estate projects. However, you must make sure that you understand the terms and conditions associated with the transaction.