When you're starting a business, you will likely need to draw on the financial support of others in the form of a loan. Securing that first business loan can be challenging. One way to approach securing a loan is to think of it from the perspective of a lender. If you had $25,000 to invest in something, would you invest it in your business plan? When you think about commercial loans this way, you can start to build your platform so that you are 110% prepared to apply for loans.
Your Idea
Of course, the first part of the equation is the idea. You want to show that you have thought through your idea completely. It's not just a vague thought that you've had; it's something that you have researched. You've already planned for various contingencies in case something goes wrong. You have researched the competition and know what you will do differently. All of this generally goes into a business plan, but you should be willing to speak about it as well if you are asked questions about your business plan.
Your Financial Budget and Projections
A commercial loans officer, like those at FCN Bank, will be interested in the research you have done to project your budget and your earning potential. This is obviously important to them because it reflects how easily you'll be able to pay back the loan. If your business succeeds, you'll be more able to make payments. If the business fails, there is some chance that you'll default on the loan. A loan officer will scrutinize the plan to ensure that the business can realistically make money.
Your Personal Financial History
Even if your business doesn't make it, lenders know that if you are a responsible individual, you will be able to pay back the money from your own personal assets. So, they will look at your credit history and your assets when making a decision about commercial loans. It helps if you have great credit as well as some savings of your own to put into the business.
In short, loan officers are eager to provide loans to candidates who have a solid business plan, who are realistic and well-prepared to carry out their business idea, and who have the personal history to back up a loan request. If you can meet all of these criteria, commercial loans are well within your reach, and your dream business may be just around the corner.
