How to Get a Small Business Loan

Questions to Ask Yourself Before Applying For a Business Loan:

1. How will I use the loan?

Before applying, you should know how you'll utilize the financing. Do you have broken equipment that must be fixed, a need to meet payroll, or do you have expansion plans?

Knowing how you want to use your working capital will help you determine how quickly you need it, the desired loan amount, and the cost you’re comfortable paying.

2. Do I have outstanding debt to pay off?

It's important to consider existing debt, whether it be from business credit cards or previous loans. If you aren’t going to use your funds for debt consolidation, it will be challenging to repay a new loan while also paying off other debts.

So, if you still have significant debt to pay off, we suggest waiting before you apply for a loan. You’ll likely feel more comfortable repaying a loan if you aren't obligated to make other debt payments at the same time.

3. Do I understand the loan application process?

Before submitting your application, you should review the lender’s qualifications.

How to Use a Business Loan

There are so many ways to use a loan to grow your operations. Here are just a few ways that you can spend your financing:

Marketing:

Do you want to gain more customers? Using your loan for marketing projects might be the right choice for you. You can invest in branded materials, social media campaigns, or test other marketing ideas.

Payroll:

Once you receive a loan, you can put it towards payroll costs. You'll be able to breathe easy knowing you can pay your valuable employees.

Expansion:

Is your business growing rapidly? Then it might be time to expand your business! With additional financing, you can increase your space or unveil new product and service options.

Paying bills:

You likely have consistent bills that you must pay to keep your doors open and your lights on. With a small business loan, you’ll have funds available, so that you won’t risk missing a payment.

Cash flow:

Many of the business owners we work with use their loan as cash flow stability. With added cash flow, you can pay for ongoing business expenses while having additional cash to use for other costs.

Inventory:

Are you worried about having enough inventory in stock? With a business loan, you’ll be able to pay for inventory orders, while still having funds for other areas of your business.

Renovations:

Whether its equipment upgrades, interior updates, or exterior projects, there may come a time that you’ll need to make renovations. Without making these updates, you could put your business at risk, so consider using your loan for this area.

Taxes:

It can be challenging to pay taxes while keeping your business up-and-running. Luckily, if you have a loan, you’ll be able to pay your taxes without taking away funds from your day-to-day operations.