Radically Important Business Basics − Part 1
Lenders and creditors have very specific requirements of what they want to see to approve you for credit and financing.
Here’s what they’re really looking for:
Your Business Name- If you are just choosing a name, try to choose as basic and loose of a name that you can that doesn’t peg you into one industry. There are a lot of industries that fall on “restricted” lists.
General consulting type names work best as nobody will deny you then, any other industry specific name very well might restrict your ability to get money with some lending sources and credit issuers.
You need a BUSINESS phone – don’t use a personal home phone or cell phone. YES, lenders WILL know!!! So don’t even try applying for money without a real business phone. Voice Over IP numbers are okay.
You should have a toll free number, unless you only deal with local business such as a pizza shop. You should have a fax number. Your number MUST be listed with 411. Try listing yourself for 411 listing.
Being a home owner increases your chances of being approved. It shows a greater level of maturity and responsibility. Plus, it shows you can manage a higher monthly payment. And your home might even be used as collateral for some financing such as SBA loans.
Lenders love assets because they love collateral so when you are asked on an application about the assets you have, what the lender is really looking for is what you can use as collateral for the debt.
The more collateral you have, the better chances you have of being approved with many types of financing. SBA loans REQUIRE the lender to take ALL assets you have in your business as collateral and if still not enough they will take personal assets such as your home.
Some lenders, such as advance lenders, don’t need collateral. It still helps them feel more secure in lending you money if you do have assets to show. Many things can work as collateral such as 401k and stocks, real estate, inventory and equipment, purchase orders and receivables, and other items that are easy for a lender to sell and get their money back in case of default.
Click Here to learn more about getting financing for your business.