Is it Tough to Get a Business Loan after Bankruptcy
Having a bankruptcy record under your name would make in more difficult for you to land that important business loan from banks and other credit institutions.
However, like what most business experts said, bankruptcy is not a reason for you to stop acquiring other kinds of loans.This article will help you to understand the step-by-step process in filing a new business loan at different financial institutions.
Like bad credit score, having a bankruptcy record under your name can make business loan acquisition more difficult for you. However, by following this step-by-step process, you can still manage to gain a business loan that you need to start a new company.
Here are several things that you need to remember:
Look for a viable lender. Try to discuss to your current situation to the bank managers. By doing this, people will understand why you have a bankruptcy record.
This will also help the banks to properly label you on what other possible loans you can acquire despite the bankruptcy mark. Always remember that lending institutions have different policies depending on the person filing for business loans. It will not hurt if you try.
Try local credit unions. If you find it difficult for banks to approve your applications, then your local credit union is the next step you need to take. Try to inquire about the economic development and what possible options they can give you for the loan. Most likely, they will point you to a small lending company that is willing to help people who have just undergone bankruptcy.
Place your business as collateral. Having a strong business plan for the new company you are planning to build is a great way to convince banks and other lending institutions to grant you the business loans you need.
This includes strong figures from the previous business and the project planning of the new company. This way, banks can also distinguish how much they can lend you depending on the risk involved. You also have to make sure that you maintain composure during interviews to look capable in the eyes of the lenders. A powerpoint presentation would also help.
Write a letter. Writing a letter to the prospective lenders explaining your situation will familiarize them to your situation even before you schedule for an interview. See to it that you include evidence of responsible business record.
Show good credit record. Even if you suffered bankruptcy, you can still convince lenders to grant you a business loan by showing them your good personal credit score. This includes electricity, income tax returns, and other types of bills.
Find a business partner. Finding a business partner with good financial credit score will help a lot. They can be the one who will represent the new business to lenders. This is also the easiest option for you to have that loan.
Follow these simple guidelines and you are assured that the business loan you need would be at hand.
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