How to Get a Start up Business Loan
Starting a business is the quickest way to get rich aside from winning the lottery. But starting a business is no easy task. When all the necessary preparations are secured and ready, one last thing is always left dangling, the capital. Businesses have trouble securing finances even at the best of times.
But there is no need to fuss and vex for here are some pointers to guide you in the acquisition of that highly elusive startup capital.
On Starting Your Business
One, it pays to be a home owner. Being a home owner means you have an asset that is of high value that may serve as security for the loan you are applying for. Lenders are risk conscious and providing for a startup capital on a business concept is a high risk endeavor that most lenders would easily shy away and deny your application for loan. Providing a security or collateral for your loan application would make them think twice before denying your application. As already mentioned, lenders are risk conscious. Providing for a security to your loan will assure them that when push comes to shove they will have a property that they can pursue or foreclose to secure the payment for the loan applied for.
Two, include all your assets. Cash, bonds, shares of stocks, vehicles and all the other property you have in your name. This will bulk up and build up your assets. In a business it is more often than not that there are a number of persons applying for loans. Include all of their assets to further boost up your assets to increase the loanable amount that your business can acquire. Just remember not to exaggerate on this one for you are liable to lose every asset you have listed in case everything turns sour. With a greater statement of assets you can provide the greater amount of loan that you can secure.
Three, it is also very much beneficial to have a good income record. Show proof of your earning capacity. Tax returns are a very good source of evidence proving your earning capacity. Have them secured as proof of your earning capacity that is also equivalent to your paying capacity. A good earning capacity will win the trust of the lenders thus your loan will be easily approved.
Four, show a list of the allocations or the proceeds of the business loan. This is very crucial to the approval of the loan to the maximum level. If the lenders can see where the money they will be lending will go to, then they will be able to asses if the business that you are proposing for a loan is viable or not. A mere loan amount with no listing of the allocations of the said amount will be very easy to reject for it will appear that there is no viable plan for the loan amount applied for. It pays to have a plan.
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