Before you can take your company to the next level, you’ll need to be approved for a business loan. During this period, the lender will be going over several data that will help them assess your credit-worthiness. So you have to put your best foot forward and do not make any of the common mistakes below.
Lying on your loan application
Providing inaccurate information regarding your financial history is a big no-no. Perhaps you’ve heard about the rumors that some lenders aren’t checking this information. This is false. Lenders check this data for everyone’s protection. It assures them that you will be able to pay the debt, and it protects you from falling into financial ruin.
Failing to submit documents on time
Before your loan application is reviewed, the lender will be asking for several documents regarding yourself and your company. Make sure that you will be giving them these documents before the deadline that they have set. Failing to provide these on time will make you look bad. How can they trust you to make payments on time if you can’t even afford the necessary documents before the deadline?
Making significant changes to your company
One of the criteria that lending parties look at that helps them decide whether or not to approve your business loan application is the age of your business. Having an operating company that is one to two years old means that you have a good business model that is stable and profitable. However, if you make significant changes to the company before or during the application, this makes your business unstable in their eyes, and you could be rejected.
Not including the business plan in your application
It sounds irresponsible or foolish, but it does happen; some applicants forget to include their business plan when applying for a loan. Always remember that this is very crucial to the lending party. This helps them assess if your project will turn into profits. If you profit, then the lenders also do the same.