The Best Way to Shop for a Small Business Loan
If you need capital to finance your small business and you aren’t sure how to get it, you might consider a loan from a bank or other traditional financial institution. However, some business owners decide not to go the traditional route because it can be time-consuming and costly to find out which banks offer what loans and how much those loans will cost when all is said and done. Instead, you can use Lendio to compare shops from multiple banks at once, ensuring that you get the most competitive rates on your small business loan.
Why Bother with Lending Platforms?
There are several reasons why you should bother with lending platforms, even if you’re not in the market for a loan. First, it’s the best way to compare shop for small business loans. Second, these platforms often offer great rates and terms that you might not be able to find elsewhere. And lastly, your time is valuable and this is one more thing you don’t have to worry about. Shopping around can take hours of your day that could be used more wisely elsewhere.
Step 1: Choose A Reputable Platform
Lendio’s platform enables users to compare loan offers from vetted lenders. This is the best way to shop for small-business loans. Users can find the best type of loan based on their requirements and even research repayment terms before applying. Once they have found the right offer, they can apply online and get an instant decision or callback.
Step 2: Search Multiple Options Before Settling on One
You may think that once you’ve found the best business loan company, you’re all set. However, there are many factors to consider when applying for an unsecured business loan. One of the most important is comparing interest rates and APRs from different lenders. Use this tool from Lendio to help compare unsecured loans with different repayment terms, APR ranges, and more.
Step 3) Once You Have Found Your Candidate, Get Pre-Qualified Immediately
The first step is to find your best option for comparing small business loans. Lendio is a great resource, as they offer both unsecured and secured business loans. What is the difference? Secured business loans use collateral, such as real estate or inventory, as security. Unsecured business loans do not require any collateral other than personal guarantees from the borrower. Secured loans typically have lower interest rates than unsecured ones but may be more difficult to qualify for.
Step 4) Determine the Value of Each Deal
Business loans can be complicated, but they’re usually not as bad as you might think. The best way to find the best option is by comparison shopping and making sure you know what your options are before signing on the dotted line.
Step 5) Know What Terms you Can Live With
There are many factors that go into choosing the right small business loan for you and your company. For example, the amount of time it will take to pay off the loan and how much money you need are important factors. You should also think about what terms are most important to you. The best way is to compare different loans side-by-side before making your final decision.
Step 6) Build Credit Before Taking Out a Loan
Start by applying for any credit card you can. This will help build up your credit score, which is important when taking out a small business loan. Once you have some history on your credit score, you’ll be in a better position to apply for the best loan rates available.
Remember that even if you get approved for one of the best loans, you may not qualify based on your outstanding debt-to-income ratio. You may need to show that there’s enough cash flow from your business to support the new loan payment or use other assets as collateral.