Is Your Bank Not Giving You The Credit You Deserve?

The cornerstone of any good relationship is trust. You’ve likely heard this from countless relationship counsellors on a variety of daytime talk shows. When it comes to your business relationships, it’s no different. A major part of your job as entrepreneur is to gain trust from the members of your target audience.

You may assume that you have a trusting relationship with your bank. After all, if you’ve been banking with a particular institution for many years, it should know that you can be trusted with the money they lend you, right? Well, not necessarily. Even when business owners have long-standing relationships with their banks, they still don’t seem to get the credit they deserve.

Do you have a poor credit history?

One of the top reasons your bank might not be giving you in any credit is because you don’t have a history of being able to make timely payments. Do you have past due balances on any credit cards? Have you defaulted on a loan before? Your credit history carries heavy weight. And as Tucker Mathis reminds us on Business2Community.com, both your personal and business credit history is taken into account.

“Lenders often view the credit scores of majority stakeholders as a reflection of the company’s ability to repay the loan,” he writes, “The newer your business (and shorter your history), the more closely your personal credit will be considered — especially if you have not yet established business credit.”

Has your business been performing poorly?

The way we see it, using this piece of criteria is a little bit of an unfair way for a bank to judge a client. After all, what’s the whole point of asking a bank to loan you money? It’s all about bettering your business, isn’t it? How are you supposed to grow your business if you can’t get a little help? Well, regardless of how we feel about it, weak business performance will cause a loan officer to deny your business loan.

According to Jessica Walrack on Supermoney.com, it has caused 31 percent of companies to get denied. “It’s important that your business can prove to lenders that you are profitable and likely to repay your loan,” she writes, “Lenders see signs of a weak performance in your profit and loss statements, tax returns, and other financial reports.  If your business isn’t well-established, you may be able to lean on your credit history or assets instead.”

Did you ask for too much or too little money?

You may assume that if you’re only asking for a small loan it has a better chance of being approved. Oddly enough, that isn’t the case. According to Mathis, asking for too little capital can hurt your chances of securing funding.

“Traditional banks commonly issue larger loans, on which they earn more interest,” he explains, “Banks may be less likely to approve smaller loans that are under around $250,000. Why? It’s all about the numbers. It takes banks the same amount of time, effort and resources to service a seven-figure loan as it does a five-figure loan, on which they make much less money.”

Is there an easier way to secure business funding?

There sure is! Contact Synergy Merchants to find out how our unique merchant cash advance program can get you the cash you need within 24 hours. Call us at 1-877-718-2026 or email us at info@synergymerchants.com. You can also apply online for a free, no obligation quote!