3 Easy Ways To Improve Your Chances Of Getting A Business Loan
In this article, we’ll cover a topic previously discussed in our Spinach TV series: How to improve your chances of successfully getting a business loan. If you’re looking for extra capital to seize valuable growth opportunities, or have been struggling with loan rejections and aren’t sure why, read on for great tips to improve your chances of getting funding. If you’d like more fantastic advice on growing your business, check out our Spinach TV series. You’ll get great business insight, growth strategies, and much more - all for free! Just click here to see our available clips.
Do you know what are three of the most common mistakes people make when trying to apply for loans? Just read on to find out!
Applying For Too Many Loans
Many people fail to consider that every business loan enquiry you make results in a little hit on your credit record. That means that when you spend a lot of time shopping around for the best deal or for any lender who’ll say yes, you’ll get lots of little blemishes that begin to add up. These marks will reduce your credit score, making it harder to get a loan. In the worst-case scenario, they can lower your credit score so much that you’re no longer eligible for a loan at all! That’s why it’s important to be conservative with your applications and not cast your net too wide.
Being Lazy With Your Finances
If you want to be eligible for a business loan, you’ve got to keep your finances in order. Sloppy financial management, such as going in and out of unarranged overdrafts or allowing payments to default are red flags to a lender. When your lender looks through your bank statements and sees that you regularly miss payments or spend more than you’ve got, they’ll consider you to be an unstable financial prospect. As a result, they’ll be wary of loaning funds to you, as they fear they won’t be able to trust you to repay your loan reliably.
Not Carefully Monitoring Your Business’ Finances
If you want to improve your chances of being accepted for a business loan, It’s essential that you don’t ignore your business’ finances till the end of the financial year. By having your financial records in order, a lender will feel more confident in offering you a loan. A great way to do so is to put yourself in a position to respond to undesirable financial shifts in an agile way. You can try taking advantage of accounting software solutions that generate automatic feeds of your bank statements. This helps you see information on your profits, losses, and margins regularly. That way, you’ll know early when things are beginning to get out of balance, or when you’re starting to overspend in a specific area. By being careful with your finances and your loan applications, you can dramatically improve your chances of successfully receiving a loan offer. If you’re looking for fast, flexible finance solutions to help your business take advantage of valuable opportunities for growth, the friendly team at Spinach can help. Simply get in touch with us at 0800 774 622 to find out how a Spinach business loan can help transform your organisation today.