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As a business owner you might require financing to boost cash flow, buy new equipment, or expand your operations. A business loan is a type of loan that you repay over time, and with interest. The type of loan for business and the lender you choose, there might be different requirements and terms that include whether the loan is secured or the need for a guarantee. To maximize your chances of getting approved, make sure to choose a lender that considers the financial strength of your business as well as your personal credit score and past history.
When choosing a business loan, make sure to take a look at the total cost of the loan, including the annual rate as well as any fees or penalties. You should also determine if the loan has been secured. This usually requires collateral in the form of such as inventory or real estate, or other assets. Unsecured business loans on the other hand don’t require collateral, but typically come with higher interest rates.
All lenders will verify your credit score before approving the loan. Some lenders will also look at your business plan, along with other documents, as part of the application process. When you apply for a loan, it’s important to have all the required documentation in place so you can submit it quickly. You can provide your personal and company tax returns along with bank statements and cash flow forecasts. Some lenders provide expedited processing for qualified borrowers.