Don’t look now but 2024 will arrive in just one month’s time! As 2023 draws…
Halloween is just over a week away. It’s a “scary” and “spooky” time of year. But, as we all know, there’s nothing to really be afraid of. All of those ghoulish costumes are designed to give us harmless thrills that are especially enjoyed by those who are young enough to go trick or treating.
When it really comes down to it, Halloween isn’t that scary at all. Being a business owner in need of money, on the other hand – now that can be a frightening situation!
As business owners all over Canada are well aware, it can be incredibly hard to convince a loan officer at a bank to approve loan applications. As we’ve pointed out in many blogs of past, there are a number of reasons why many business loans are denied. Among them are a lack of collateral, a poor credit history and poor preparation of documentation.
Did you fill your application out properly?
“Sadly, one of the most common reasons small business loan applications are denied is that the applicant didn’t complete the application correctly or didn’t provide all the necessary backup information,” explains Rieva Lesonsky on Fundbox.com.
However, it’s important to note that the list of reasons why many loans are denied also consists of things you may never have thought about. On TheBalanceSMB.com, Jean Murray highlights a number of difficulties often faced by owners of start up businesses. She points out that having a lack of a proven customer base can throw loan officers off.
Do you have a loyal customer base?
“Yes, it’s one of those ‘Catch-22’ situations; you can’t get a loan unless you have customers, but you can’t start your business and get customers without the loan,” Murray writes, “If you can show that you have some strong customers lined up, that might make a good impression on the lender.”
It’s also important to highlight the thriving nature of your industry in your loan application. When you fail to paint your field of business in a positive light, it may give banks pause when considering loaning you money. As Lesonsky points out, some industries are considered to be “risky” by traditional lenders.
“Restaurants are a good example because they have a high failure rate,” she reveals, “If your business operates in certain ‘vice’ industries, such gambling, you may also face extra hurdles to getting a loan. If this is why you were rejected, investigate lenders who specialize in your industry—they’re out there.”
Did you ask for enough money?
Sounds like a strange question, doesn’t it? Most would sensibly think that if they don’t shoot too high in terms of their monetary requests, they’ll have better chances of getting their loan applications approved. Not so, says Lesonsky.
“It sounds counter-intuitive, but often, the more money you ask for, the more likely you are to obtain a bank loan,” she informs, “For banks, the cost of servicing small loans (under $100,000) is just not worth it, which is why you generally can’t get business loans for small amounts of money from a major bank.”
At Synergy Merchants, we’re not at all scared to approve business owners for our merchant cash advances. Find out just how easy it is to get approved by calling us at 1-877-718-2026 today! You may also email us at email@example.com.