What are the New Rules of Small Business Financing?
If you are thinking about acquiring a business equipment lease or other means of business financing, consider the following tips on how to ensure the approval of your application:
The importance of your credit history. Lending companies will check on your credit report when reviewing your lease or business loan application. If you are a new business owner with no business credit history, your personal credit rating will be reviewed.
It is recommended to get a copy of your credit report from the 3 major Credit Bureaus (Equifax, Experian and TransUnion). Make sure that your report is accurate and if your credit rating needs improvement, you may want to work on raising your credit score first before applying for a business lease or loan.
The New Automated Credit Scoring System Now that most lending companies offer online services, the use of automated credit scoring systems have made the application process a lot quicker. The automated credit score is used for business owners who need smaller business financing worth less than $100,000.
All you need to do is fill out an application from the internet, submit it online and wait for approval. If you have good credit rating, you should have no problem getting the loan or the lease you need.
Generally, lending firms that offer equipment leasing services are more lenient that lenders who offer actual cash. However, you can ask for lower interest rates and better repayment terms from your lease if you have a higher credit score.
How to Use the New System
If you prefer to apply online, it is recommended to choose larger banks than smaller financing firms. You want to make sure that the lending company you will partner with is legitimate, reliable and financially stable.
Before filling out an online application, make sure that you are using a secured website. Scammers are known to use “phishing websites” that are made to look like the website of a genuine company to steal information from unsuspecting consumers. See to it that you the URL of the site begins with https://, indicating a secured server.
To speed up processing of your loan, double check the information you provide. Make your business description as detailed and accurate as possible. Be sure to define the correct business type as this is important in the approval of your application. If you feel that your application have been declined incorrectly, ask a representative of the lending company to personally review your application.
Irish Taylor is a bussiness loan consultant with Startup Business Loans and has been providing consumers and business owners with startup business financing since 1992. For years she has helped people with credit and loan problems especially pertaining to business start up, SBA loans and Unsecured loans.
Copyright 2009.
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