How To Successfully Obtain A Business Loan
It is a fact that because of the economic recession we’ve experienced in 2008, the lending criteria for our banks have changed. As our economy recovers from this recession, young entrepreneurs will have to count on our banks and other loaning establishments to support their growing business. They will turn to loaning money because they need it in order for their business to continue growing. The problem these business men face is the fact that because of the recession, most if not all banks have changed their lending criteria, they have become more strict and detailed making it hard for people to apply for a business loan. Even though getting a business loan is not an easy task, in this article, allow me to provide you some helpful tips that may serve as your guide when you are applying for a business loan of your own.
1. Have a strong existing banking relationship
The first advice to increase the likelihood of you obtaining a business loan is to have a good and existing banking relationship. It is advisable that you apply for banks that offer personal or business checking accounts, this will definitely increase your chances of obtaining a business loan. Banks earn money if they earn more on the interest they charge on their loans compared to the payout they give for their client’s deposits. You have a higher chance of obtaining a business loan with bank where you have made deposits with, it is likely that they would make an exception with regards to their strict lending criteria just because you have a professional relationship with them. People would love to do business with other people they know and trust.
2. Prepare a simple yet practical business loan proposal
Most if not all banks receive numerous business loan requests every single day. A lot of bankers will not mention this to you but they would really love to receive and approve business loan proposals that are not too detailed, they prefer receiving practical ones. It is highly recommendable that you only put key highlights of your business along with your information on the proposal you are going to present.
3. Give them an interesting presentation
Your business loan is very likely to be approved if you have a clear and practical proposal and if you are able to give an interesting presentation. This is a must in order for you to leave a positive effect on the banker. Keep in mind that these bankers would review and analyze a ton of requests every week, you must stand out from the others. Try your best to capture the interest of your banker.
Applying for a business loan is not as easy as it seems, however, if you remember and apply all of these helpful tips, you are guaranteed to increase your chances of obtaining a business loan.