Cash, moolah, dough, frog-skins – however you say it — it’s in short supply when you need it the most. (The truth is, there IS enough money to go around. It’s not like it’s “lost” somewhere. You just haven’t made enough yet)…
Unfortunately, it is also generally needed in large amounts for startup businesses, and therein lies one of the fundamental issues with getting a business off the ground.
Many people turn to a small business loan for their cash woes.
After all, getting a loan on home equity could result in you losing your house should the business not take off.
Credit cards can often lead to trouble if not managed well, and that trust fund that we all wish we had never seems to exist for most of us.
What are some simple ways to approach bankers or loan institutions to get a small business loan?
Business loans are increasingly difficult to get, particularly in the current economy.
Obviously, I can’t promise you unequivocal success in your search for a business loan, but these are considerations you should keep in mind when preparing and presenting your case.
Keep in mind that the most often-cited rejection of business loans has to do with risk factor.
Your main goal in applying for a small business loan should be proving to the bank that your risk factor is not unduly high – and if you’ve done the proper market research, it shouldn’t be.
Take note of the following points:
- How much money do you need? Be realistic. A well-planned request for a loan will be received much better than one that asks for the moon.
- What are you going to do with the money? Document every dollar requested. Every dollar.
- When will you repay your business loan? This is of utmost interest to the bank. If you can offer a solid repayment plan through your expected long-term profitability, they’re more likely to bite.
- Prepare yourself emotionally. What will you do if you don’t get the loan? Let the bank know that even if you’re rejected, you’re so confident in your idea and your competencies that you’re not going to let it stop you. You’re in control. You’ll make it happen whether or not the bank helps – and this is probably the most important thing of all. Don’t stop your search, or get discouraged the first, second or third time. Keep digging, and expand your reach. Solicit more professional help, and learn as you go.
What concerns do you have approaching banks these days? Scum of the earth, or business entrepreneurs that help?
- Loans To NYC Small Businesses Up 45 Percent (newyork.cbslocal.com)
- What Bankers Really Want (entrepreneur.com)
- Hurry Up to Get Small-Business Breaks (thestreet.com)