Published On: Tue, Sep 26th, 2017

What To Remember Before Submitting A Loan Application

Having your own business, or starting one, or working in a partnership of one is a lot of responsibility. The worst you’ll have to face in terms of dire situations is the idea of financing. Where is it going to come from? What will it involve? You’ll see there’s already plenty of questions to account for, and this is just hypothetical. It’s clear there’s a long list of things to think about before applying for a loan, but what are the big questions? Here’s a few thoughts for you.

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Is Now the Right Time?

Are the purchases or investments you mean to make absolutely necessary? Is there no other way around the obstacle? These are just subclauses of the timing question, and help to illustrate its complexity.

Loans are usually lent out for short periods, and you’ll only have about 10 years at max to pay them back. You also need to go through your inventory and find out if you have the right collateral in case of any unpaid debts a lender will need to collect on. If not, you might need to try and build up your finances, or find an alternative source.

 

Is There An Easier or Better Way to Get the Money?

This is the next consideration. Rather than heading to your bank or building society, there’s other places to check for a loan that you can both afford and suits your needs best.

If you work online, or just surf the web daily, you’ve probably come across something like smallbusinessloans.co. This is a perfect alternative to the traditional bank loan, and often can feel easier to secure a loan through. Of course you’ll need the usual proof, but it’s accessible for anyone.

You could apply for a business credit card if you need a little more credit each month. Moneyadviceservice.org has a comprehensive guide for credit cards if you need a runthrough. Of course you’ll still need to pay it back, but it’s on a smaller scale and a more popular method. Try to keep a balance on your withdrawals each month.

 

Can I Keep Up with the Payments?

 

This is the big question you need to truly and properly consider. Do you have plenty assets stored behind you to make payments on time and in full? If not, it might not be right you take a loan. Sure, knowing you’ll be able to turn over a profit in the near future to service your loan repayment needs makes this less risky, but we can never predict the future.

 

Sales may never go through. Emergencies may crop up. New taxes may have to be paid. There’s a lot of unknowns alongside your unsurety of repayment. Do yourself a favour and wait until you’re in a better position. It also means you’d be safer to invest with your new money if it’s taken out at a later time.

 

There’s a lot to get used to when it comes to the business world and financing!

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