Whether you are just starting with your business or you have been on this field for years, when you hear the words small business loan, it can still bring this intimidating feeling in your gut. The process of getting a financing for business can be overwhelming to some and can be downright scary for the first-timers. Because of this general feeling towards business financing, many myths have surrounded the concept. Let’s go through some of them and see if they really are the truth or just a mere myth:
- You have to have a PERFECT credit
It is not shocking if entrepreneurs think that they have to have a spotless credit history to qualify for a business loan. Although having this will greatly improve your chances of getting the financing you need, the whole concept of ‘it needs to be spotless’ is completely a myth. As the classic saying goes: ‘Nobody is Perfect’, and institutions that provides small business loans knows this.
Don’t disregard the thought of getting a financing just because you know that your records are not perfect. Besides, credit score requirement varies depending on what kind of loan you’re after. The bottom line is to maintain a good credit history.
- You can only finance large amounts of money
Many small business owners tend to think that financing is only appropriate for those businesses that requires a huge amount of money to fund their growth. Yes, for some financing institutions, this might be true and they mostly approve those who prefer larger loans but it should not be generalized. This concept as a whole is a myth most especially now that there are a lot of microloans options.
There now exists a lot of microloan programs that small business owners can choose from. You just need to do enough research to find the right one to meet your financing needs.
- All business financing options are alike
Choosing financing options is not just like answering a multiple-choice question where you just need to pick one from A, B, C, or D. Loans vary on case-to-case basis and a lot of different factors will play a role in determining what kind of financing you will be provided with.
Some important factors are your current finances, credit history, business needs, and plans for the funds that you are applying for. The best thing you can do is give as much information about your business as you can and make sure all of it are accurate to get higher chances of being approved.
No matter what financing you need, there’s an option out there that’s right for you. Just do your homework and do the right research to find what you truly need. If you need help in getting your financial information ready for a small business loan, contact us today at firstname.lastname@example.org or (832)-437-0385.