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At Nextfin, we help hundreds of small businesses find and apply for loans from P2P platforms or other alternative providers. As such, we have a very good understanding of what is required if you want your application to run smoothly, be processed quickly and be successful. For businesses and entrepreneurs considering applying for a loan here’s a list of what you need to be loan ready:
Lenders want to review the affordability of a loan. Therefore they are looking for evidence that shows that the business can make repayments even if things don’t go exactly to plan. Healthy profit margins and good money management are important and they will want to be aware of existing business loans or regular monthly payments and how these have been managed.
It is worth noting that generally lenders won’t loan more than a month’s turnover without additional security. So if you are seeking more than a month’s turnover applying for a secured loan would be a better option for you.
What you need:
Affordability remains the key element of loan success; lenders want to see that even if things don’t go to plan repayments can be met. But when seeking larger loans (relative to turnover) lenders look for security against assets held by the business or by an individual(s) within the business. Which means that if applying for a secured loan you need to have the full details of those assets; inclusive of value and any existing debt that uses the assets as security.
What you need:
Trading history: the length of time that your business has been trading and details of the business including the sector that it is in.
Authors: Oliver Murphy & Sacha Bright
Disclaimer
To the best of our knowledge, the information we have provided is correct at the time of publishing. Sacha Bright is not a solicitor or accountant and we recommend that you seek professional advice on any topic discussed.
Tagged: Loans Business SME Startup Entrepreneur
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