It’s possible for almost any business to receive approval for a small business loan. However, you can do some things to increase the odds of getting funded. Businesses with bad credit that look in all the wrong places for financing have a difficult time getting approved for a loan.
You don’t have to be one of those businesses. Here are a few tips to help you increase the odds of being approved for a small business loan.
Build Some Credit
The loan of your dreams might be just a few credit score ticks away. OK, maybe you don’t dream about loans, but you do dream about the future of your business, and the right loan can really help you get there.
Step 1: Know your credit score. You can check your score from these 3 business credit report providers:
Once you know your score, it’s time to work on it.
Step 2: Apply for a smaller financing product like a business credit card or line of credit. It’s easy to get approved for a business credit card. In fact, you can apply for a business credit card right now.
Step 3: Use the credit card every month and pay off the balance at the end of the month. Make this a habit. Best of all, if the card has a cash back rewards program or a miles program, you’ll earn free rewards while your credit steadily improves.
Step 4: Be sure to check your credit regularly. There are 2 reasons why this is important. The first is to ensure your credit is improving as you make timely payments. The second is to check your credit report for errors. Errors can hurt your score. If you see an error in one of your reports, contact the provider to have it corrected.
Improving your credit takes a little time, but it’s worth it in the long run as it’ll make many more financing options available to you.
Check Out a Lending Marketplace Like Lendio
Lending marketplaces make it easy to secure the financing your business needs to grow and succeed. Loan applications at traditional lenders take an average of 29 hours to fill out and submit. Here at Lendio, however, our application only takes 15 minutes. Best of all, we send your information to our network of more than 75 lenders.
That’s like filling out 75 applications and driving them to every lending institution in town. What does that mean for you? It means you have more than 75 chances to get approved for a financial product. Businesses that apply at a lending marketplace get approved for a financial product 60% of the time–compared to only 20% that apply at traditional lenders.
Best of all, marketplace lenders can get money in your pocket in as little as 24 hours, making them great for businesses facing a time crunch.