Things to Think About When Applying For a Small Business Loan
If you've ever dreamed of owning and running your own business, you know how nice that can sound.
No boss, no coworkers, no need to get dressed in a suit (bunny slippers are allowed in the office), that ability to start and end your work day when you choose.
And of course the ability to set your own income.
Indeed, this is a dream that is shared by many, but put into practice long-term by few.
Why? It takes real, hard work.
In fact, don't be surprised to find yourself working longer hours than you did at your job, as you're starting out.
That said, you will need to give thought to what equipment you need, your market, how you plan to market your services, as well as the bare minimum you'll need to deal with expenses once handled by your paycheck.
This is not a course of action to be taken lightly, but it can be quite fun.
That said, you may have briefly thought about obtaining a small business loan.
But before you do, there are a few things you need to think about.
First, you will have to consider your credit worthiness.
After all, banks, especially these days, will outright refuse a small business loan to those they feel are a high risk for paying it back.
This can be a stumbling block and is something you'll need to look into especially if the small business loan exceeds several thousand dollars.
In this case, you might need to pay for your equipment out of your own pocket, which is certainly not a bad thing as you learn to do with what you've got and once you can actually afford to, then get the better equipment.
Another thing to consider is that in order successfully get a small business loan, you will need to do quite a bit of thinking and research and be able to show your results in a manner that the lenders you are courting expect.
This means creating a solid business plan and while there are many software solutions that will quickly allow you to build one, they are only as good as the data you put into them.
Remember a few paragraphs ago when I talked about those long hours? Well, these are them.
You need to first clearly define the problem you are trying to solve as well as your solution (be it product or service).
Then, you'll need to show that it is commercially viable.
This is one of the most important things when applying for a small business loan: will your product or service be in enough demand that you'll be able to pay back the loan in an expedient fashion? When applying for a small business loan, potential lenders will also want to see what sort of plan you have for long-term growth and if you have measurable milestones, as this is what will keep your business on track and see you through those trouble spots that all business owners eventually have.
In short, if you take the time to consider the above and have your answers on paper, you will find the process of obtaining a small business loan that much easier.
No boss, no coworkers, no need to get dressed in a suit (bunny slippers are allowed in the office), that ability to start and end your work day when you choose.
And of course the ability to set your own income.
Indeed, this is a dream that is shared by many, but put into practice long-term by few.
Why? It takes real, hard work.
In fact, don't be surprised to find yourself working longer hours than you did at your job, as you're starting out.
That said, you will need to give thought to what equipment you need, your market, how you plan to market your services, as well as the bare minimum you'll need to deal with expenses once handled by your paycheck.
This is not a course of action to be taken lightly, but it can be quite fun.
That said, you may have briefly thought about obtaining a small business loan.
But before you do, there are a few things you need to think about.
First, you will have to consider your credit worthiness.
After all, banks, especially these days, will outright refuse a small business loan to those they feel are a high risk for paying it back.
This can be a stumbling block and is something you'll need to look into especially if the small business loan exceeds several thousand dollars.
In this case, you might need to pay for your equipment out of your own pocket, which is certainly not a bad thing as you learn to do with what you've got and once you can actually afford to, then get the better equipment.
Another thing to consider is that in order successfully get a small business loan, you will need to do quite a bit of thinking and research and be able to show your results in a manner that the lenders you are courting expect.
This means creating a solid business plan and while there are many software solutions that will quickly allow you to build one, they are only as good as the data you put into them.
Remember a few paragraphs ago when I talked about those long hours? Well, these are them.
You need to first clearly define the problem you are trying to solve as well as your solution (be it product or service).
Then, you'll need to show that it is commercially viable.
This is one of the most important things when applying for a small business loan: will your product or service be in enough demand that you'll be able to pay back the loan in an expedient fashion? When applying for a small business loan, potential lenders will also want to see what sort of plan you have for long-term growth and if you have measurable milestones, as this is what will keep your business on track and see you through those trouble spots that all business owners eventually have.
In short, if you take the time to consider the above and have your answers on paper, you will find the process of obtaining a small business loan that much easier.
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