Tips for getting your small business loan
Whether it’s your goal to expand into a different market, put on additional staff or buy equipment, a small business loan can go a long way to making these goals achievable.
So, what can you do to give you and your business the best chance of securing the finance you need to take your enterprise to the next level?
Our top tips for your business:
- Be clear about how much you need and how you will use it:Whether you are applying with a bank or non-bank lender, have a clear plan about how much you need and where you will be investing. This shows you are prepared and have put thought into how these funds will help your business grow.
- Keep account conduct clean:Lenders love to see that you can manage your cash flow and expenditure. Your business bank statements provide the best proof of this. Focus on ensuring you have clear conduct prior to applying for a loan by avoiding overdrawing your account, late fees and dishonours to demonstrate your ability to manage your businesses money.
- Manage your tax debt:Ensure that your tax obligations are up to date or in an approved repayment arrangement. Lenders want to see that you’re managing your tax commitments so ask your accountant or bookkeeper to provide you with your current ATO portal statement (Integrated Client account) to confirm you’re up to date.
- Aim to have a clear credit history:While your business is often considered separate to your personal finances, lenders will consider your personal credit score and history when looking to extend a loan to your business. A previous negative mark on your credit history won’t mean you can’t borrow however it’s important that you know where you stand and how to explain any items that may arise.
- Know your numbers:Understand your average monthly revenue and expenditure to get an overview of your monthly profitability. These are the most important numbers by which lenders will determine how much to you can borrow.
Use the YOZO limit calculator to determine your borrowing potential now!
Borrowing can seem like a daunting task. YOZO is here to help take the pain out of small business lending by helping you secure the finance your business needs. Feel free to check out our Knowledge Hub for more tips and ideas to help your business grow.