So you’ve decided to start a business! You need to get a small business loan, but are unsure of what to do before you apply for that loan?
Following these steps will save you time and frustration during the application process.
Step 1: Check your credit
In order to be considered for a loan approval:
- You must show and prove creditworthiness to the lender.
- Pull and review your credit report for free www.annualcreditreport.com
- The credit requirements vary by lender but your score should be at least a 630.
Step 2: Determine how much you will need to borrow.
This covers three steps:
- Complete a business plan
- Include in the business plan projected financial statements (the financial section will aid you in determining how much you will need)
- You can find a sample business plan template at http://app1.sba.gov/training/sbabp/bptemplate.pdf
Step 3: Be sure to have all business licenses
You will need to have all licenses pertinent to your business in place before you contact the lender. For a Philadelphia, Pennsylvania business the main three licenses are:
- Business Privilege License (City) http://webapps.phila.gov/li/
- Registration of Fictitious Name (State)http://www.dos.state.pa.us/corps/lib/corps/20/7/311.pdf
- Employer Identification Number (Federal) http://www.irs.gov/pub/irs-pdf/fss4.pdf
Step 4: A business checking account
Every business owner should separate his/her personal finances from the business activity. This will allow you to track your business’ profit and losses.
Will the stimulus package help small business owners? Is there anything in the package that will simplify the loan approval process? As a small business owner, I need start-up and working capital. Will business owners receive better loan rates through the Small Business Administration?
Thank you for your inquiry Mr. Barrick. Yes, the stimulus package will help small business owners. The Obama Administration announced that the Treasury Department will commit up to $15 billion to help unlock the secondary markets for small business loans. This will facilitate the ability of lenders to make new loans to small businesses.
The loan approval process remains the same but if you follow the steps given to you in the blog, it will prepare you to be ready to go to a lender. Also, by having these items in place, this could possibly speed up the application process.
The micro loans $5,000 – $50,000 PCDC have available are SBA guaranteed loans. These loan funds can be used for start-up and working capital for your business. The rates vary depending on how much you are looking to acquire. If you need additional information, feel free to contact me at 215-790-5000.
You can also contact Mr. John Banks at the Small Business Administration at 215-580-2711.
Hello!
Very Interesting post! Thank you for such interesting resource!
PS: Sorry for my bad english, I’v just started to learn this language
See you!
Your, Raiul Baztepo
Hi !!!
I am Piter Kokoniz. oOnly want to tell, that I’v found your blog very interesting
And want to ask you: what was the reasson for you to start this blog?
Sorry for my bad english:)
Thank you:)
Piter Kokoniz, from Latvia
Thank you for visiting our website Mr. Kokoniz. I find that when I speak with clients, it is their first time trying to apply for a loan and before speaking with me they had no knowledge of how they could have prepared themselves prior to calling me. This blog was written to create awareness to those indviduals so they can be a step ahead before contacting a Lender.
Hi, interesting post. I have been wondering about this topic,so thanks for sharing. I will definitely be coming back to your site.
Hi, interest post. I’ll write you later about few questions!