Business loans can give you the funds needed to expand your business or pay employees, as well as cover other expenses. Before you apply, make sure you are aware of how loans work and what type of documents you’ll need submit to your lender. Be aware of the length of time required to submit an application as well as any fees that might be to be charged.
Common uses of business loans
A business loan can be used to pay for unexpected expenses, like the damage to your office https://southbeachcapitaladvance.com/advance-capital-for-small-businesses chair or the COVID-19 pandemic. It is also possible to borrow money to cover an unavoidable investment such as upgrading or replacing technology, purchasing manufacturing machinery, or remodeling the interior of a store. Some lenders offer lines of credit that allow you to draw funds when needed, with a set maximum and interest charged only on the amount that is used.
Application requirements and eligibility requirements
You will need to provide detailed details about your business including the official name of your company along with its tax ID as well as any financial documents. This could include business plans, proposals, statements of profit and loss and the names and Social Security Numbers of those who own 20 to 25 percent or more of your firm. Some lenders require that you have been in business at least one year. Others are open to startups, or do not have any time limits.
A mentor or adviser can assist you in the process of getting a business loan. The organizations like SCORE have a network of volunteer business mentors who offer free or minimally-cost guidance for startups and small business founders. Find a local chapter and talk to an advisor in person.