Business loans can https://southbeachcapitaladvance.com/credit-card-debt-and-capital-shortages-by-board-room help you get the capital to finance expansion to pay employees and cover other costs. Before you apply, be sure you understand how these loans work and what kind of documents you’ll need provide to your lender. Be aware of how long the process can take and any charges you might incur.
Common uses of business loans
A business loan may help you pay for unexpected expenses, such as an injury to your chair at work or the COVID-19 Pandemic. You may also require financing to cover an unexpected capital expenditure, such as upgrading or replacing technology, purchasing manufacturing equipment or remodeling a retail store. Some lenders offer lines of credit that allow you to draw money as needed, with a set maximum and interest only charged on the amount used.
Eligibility requirements and application process
To be eligible for a business loan, you will typically have to provide complete information about your company, which includes the official name of the business, tax ID number and financial documentation. This could include business plans or proposals, as well as profits and loss statements, and the names and Social Security Numbers of those who control 20 to 25 percent or more of your company. Some lenders require that you have been in business for at least one year, while some allow startups and don’t have any time-inbusiness requirements.
A mentor or adviser can guide you through the process of obtaining a business loan. SCORE is one example. has an extensive network of business mentors who offer free or low-cost advice for entrepreneurs who are starting their own businesses. Find a local chapter and meet an advisor in person.