3 Application Tips To Get Your SBA Loan Approved
For most small business owners, having extra capital to hire help, increase production, move to a new location, or simply stay afloat could be life-changing. However, applying for a loan can be daunting, to say the least. Luckily, the Small Business Administration, a government agency, offers SBA loans backed by the administration and designed to make it easier for small businesses to receive much-needed financial help.
While these loans are easier to secure than traditional loans, you still need to meet some important requirements to be approved, such as having a good credit score and a viable business plan. Additionally, you can do a few things on your application to ensure that your request is processed and approved quickly.
1. Explain How You’ll Spend Your Loan
This may seem simple enough, but letting a lender know exactly how you plan to use your capital is of paramount importance. As the business owner, be proud of your plans for these resources. Let the lender know that the money will go to good use and more importantly, help your business thrive.
2. Include Plans To Repay Your Loan
Just as important as how you plan to spend the money is your plan to pay it back. Before even applying for the loan, be sure you’ve worked out these numbers. When filing your application, clearly state your plans for the money, the revenue you intend to gain from the boost, and a detailed plan for how you’ll be paying it back. This shows the lenders that you have a very precise strategy, so lending to you is less of a risk on their part.
3. Provide Proper Documentation for Your Loan
There are few things as frustrating as getting denied a loan because of improper documentation. To better your chances at approval, you want to include every financial document from your business’s history, especially tax documents and annual revenue reports. This allows the lender to look at your track record and gauge whether your plans to spend and repay the SBA loan are viable.
As you can see, there are still several hoops to jump through when applying for SBA loans, but not quite as many as you’d have with more traditional loans. If you can provide these valuable details, your loan has a higher likelihood of approval, and your business will be flourishing in no time.