If you are a new business looking for a loan to help you get through the trials and tribulations of the financial year then we have the solution for you. Read on to see our top tips regarding applying for business loans.
How Do I Apply?
When looking to apply for a business loan it is very simple. You can either apply through a bank with a lengthy process or there are sites online that help you to compare business loans so that you can find the right one for you. It is very easy to apply for a business loan, all you have to do is input your information into the comparison tool and you will be matched with a number of lenders that will help you make the most out of the money that you borrow. Whether you are borrowing a large amount of money, or a smaller amount, there will be a lender to help you.
What Are the Different Types Of Business Loans
When looking to apply for a different type of business loan there is plenty for you to choose from. Below is a small breakdown of the different types of business loans that exist and a bit more information on each.
Unsecured Business Loans– An unsecured business loan is ideal for those that are looking to apply for a business loan without having to put forward a level of security. This is most beneficial for smaller businesses such as start-ups as they have significantly less assets to put forward as a form of collateral. However, this still allows them to apply and get the money that they need with a repayment scheme that is based around their monthly earnings.
Secured Business Loans – Unlike an unsecured business loan, this style of loan requires you to have a level of security to act as collateral should you default on repayments. These items are most commonly assets of value such as property and are to equate to within the region of the amount that you are borrowing. This form of loan is most common if you are borrowing a large sum of money as the risk is equal between the business and the lender.
Criteria For Applying
When applying it is paramount that you research the criteria of each of the lenders you are looking to borrow from. This will help to see if you are eligible to apply as well as ensure that you are likely to be accepted first time. The lender companies often require a minimum amount that your business must be earning before it can be considered for a business loan. If your business is one that has been around for a long time it is required for your business to have a substantial amount of constant revenue as well as a good credit history. Yet, there are also business loans that are accessible for the businesses that are looking for a start-up loan. This is perfect as it allows them to have the loan and the money that they need without an extensive credit history.
With all this in mind, it is increasingly important to do your research when applying for a business loan, as this can have an effect on the way that your business can pay back the loan.