Anyone who has started a new business understands that from time to time you may face unexpected expenses. Nevertheless, you need to provide good reasons to a lender as to why you need the money. To help substantiate your story you should provide the lender with 3 years of financial statements. This will assistance the lender in assessing your repaying ability.
It is also important for a lender to check your credit rating. A potential lender will rely on all of your documents and financial statements to make a good decision on the amount, rate and term of a loan. If we need to show larger assets, then information concerning real estate holdings should be provided. Providing security tends to reduce the rates as the risk is reduced. If it is determined that we do not need to borrow a larger amount of funds, then an unsecured loan is sufficient and the rates are usually a little higher.
Business people with a bad credit history should first try to improve there credit rating before they apply for a loan. But even if they have mixed problems like: arrears, defaults, late payments, CCJ’s etc, there is still a good chance that a loan can be approved if the business shows the capacity to repay the loan in a timely manner.
There are many online lenders for small businesses, and they offer different rates. They want to be competitive, so look for the best deals and present information so they can see how your business is really doing.