25 Tips To Getting A Small Business Loan

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Getting A Small Business Loan

The approval process for a small business loan can be a daunting task.

After helping thousands of business owners, we’ve collaborated the top 25 tips to getting a small business loan. To find out more about different types of business loans you can go here: http://venturycapital.com/business-loans-for-bad-credit

Here they are:


General rule of thumb: the longer you’re in business the more likely you are to get a good rate and term loan.

time in business


Lenders prefer to lend to healthy businesses. Decreasing bank statements can be a sign of instability.

Apply when your business is doing well,


NSF’s and Bounced Checks are a big “no-no” in lending

overdraft protection


When taking on debt financing, it’s crucial to be able to get a return on that investment

invest your loan


Credit is always a factor in a business loan. Understanding credit for a business loan is essential.

build business credit and personal credit


Putting together a use of funds statement is a big part of writing your business plan.

use of funds statement


Sometimes lender require tax returns, P&L’s, Balance sheets etc. It’s best to have these close

financial records


Be honest. They’ll find out if you’re lying and kill the loan right there.

 be honest about your business


Time in business is a biggie. No lender will lend to a business that cannot show steady consistent deposits
for atleast 6 months. Best shot is after a year.

loan application


If you take $500 out of an ATM at your local casino, underwriters will see that and it will NOT help.
Just stop at your bank on the way! (Ask us how we know 🙂

wise cash flow decisions


Large balances = large loan amounts

highest balance in business account


The art of a letter of explanation can go far with underwriters.

paint the picture


Keep the bank accounts clean. Most businesses have an operating, payroll, and money market account.
Process all payments through the operating account.

muddy financials


I know this sounds silly, but your application is the first impression you have on the underwriter. Make sure you write nicely
.legible writing


Don’t ask for $1,000,000 if your company does $10,000 a month. It won’t happen.

realistic request for money


Industries matter. Check to see where your industry falls in the risk category or ask a professional.

industry type


Better have a structured settled in place if you have these.

no tax liens or judgements


GAR can have bearing on underwriting. Make sure your stated GAR matches your bank statements.
Example: Don’t put a GAR of $1,000,000 if the banks you submit are $25,000 a month.

gross annual revenue


You want as many as possible. Instead of depositing all checks on one day, go to the bank multiple times.

daily deposits


Borrowed money needs to have a purpose, and the underwriters are more likely to consider the business owner with a plan of action.

game plan


Many companies offer one lending program because they believe in the model. Ventury offers several lending programs.
This relationship enables your business to have access to many other financial vehicles that fit your model

lender that knows what they're doing


Keep your daily ending balances above 10% of what you deposit.


ending balances


Predict future business needs and ask for financing when bank deposits are high, not when business has fallen.

times are tough


SBA loans have best rate but take 3 months to close and require over 15 documents. Other loans don’t have the best rate but require 1 or two documents.

funding time


Lenders see consistent credit card sales as a sign of stability.

credit card transactions