We’ll try to keep this article short, while still informing you of the reasons why you need a financial advisor when considering a small business loan. If you don’t have one, then be prepared with the following business loan-related questions for the lender. This will get you the best deal you can manage – depending on the particulars of your present and projected business situation.
I. What kind of loan or credit suits my particular business model?
There are a variety of small business loans and credits available to businesses of all sizes. When considering a small business loan, it is important to consider the amount you need, the purpose of the loan, and your credit score. Some small business loans are unsecured, while others are secured by the business assets. The best small business loan for your business will depend on your individual circumstances – and a good advisor will be able to go through the benefits and detriments of each suggested loan type.
II. What type of documentation do I need for the loans you offer?
To apply for a small business loan, you will need to provide some documentation about your business. This may include financial statements, a business plan, tax statements, and information about the owners of the business. It is important to have all of this information ready when you apply for a small business loan, as it will help the lender assess your eligibility and loan terms.
III. Are there ways to lower my interest rates and other loan payments?
There are a few things that small business owners can do to lower the interest rate on their small business loan. First, be sure to compare interest rates from different lenders before you choose a loan. Also, make sure you are always up-to-date on your credit score and credit history, as this will help you get a lower interest rate. You can also work to build up your business credit score, which will make you a more attractive borrower. Finally, be sure to keep up with your monthly payments and stay in good standing with your lender – this will also help you get a lower interest rate.
IV. How does your company handle loan modifications and renewals?
When you take out a small business loan, you are agreeing to repay the debt over a predetermined period of time. If you encounter difficulties making your monthly payments, you may be able to negotiate a loan modification with your lender. This will involve renegotiating the terms of your loan, such as the interest rate, the amount of the monthly payments, or the length of the loan. It is important to remember that a business loan modification is not a permanent solution – it is simply a way to help you get back on track with your monthly payments.
V. What happens in the event I have trouble making monthly payments?
If you are unable to make your monthly payments, your lender may decide to renew your small business loan. This means that they will agree to extend the term of your loan, and give you more time to pay it off. It is important to note that renewing your small business loan will likely involve an increase in the interest rate, so be sure to compare rates from different lenders before you decide to renew.
Both the loan modification and renewal processes can be helpful ways for small business owners to get back on track with their monthly payments. Be sure to talk to your lender if you are having difficulty making your payments, and they will be able to help you find a solution that works for you. Before you make the call, don’t hesitate to reach out to us at Dorra Financial Group for more information on the process.