The Business Credit and Financing Guide
VII. SBA Loans and Qualifications SBA Loans are the main types of business loan offered by most conventional banks. These are great loans for business owners who have what it takes to qualify. Keep in mind, most business lending comes from alternative lenders which don’t have these types of requirements. Instead, conventional banks and SBA focus on offering loans with minimum risk to them. As a result, much more is necessary for approval versus a conventional loan. The SBA has put together a checklist of what you need before applying. Here are some details. To get approval for conventional loans you must have excellent personal credit. There can be no derogatory reported items. You need excellent bank credit keeping over $10,000 liquid in your accounts. And you must have excellent business credit with a good PAYDEX score, often 70 or higher You must have excellent financials showing good net profits increasing from year to year. You must show you manage cash flow well, per your business and personal bank statements. And you need substantial collateral to offset what you’re borrowing, sometimes equal to 100% of the amount to be borrowed. Other items you must provide for approval include: a profit and loss (P&L) statement current within 90 days of your application. Include supplementary schedules from the last three fiscal years. Provide current and projected financial statements. Also provide a detailed, one year projection of income and finances. And attach a written explanation of how you expect to achieve this projection. You also need: ●● Original business license or certificate of doing business ●● Loan application history including records of loans you applied ©️2022 The Distributor of this e-Book, all rights reserved . No reproduction or use of any portion of the content or work or the entire work is permitted without the express written permission and authorization of the publisher . However , the publisher of these materials routinely grants authorization for reproduction or use of this work , in whole or in part. If you would like to use any portion of this material in a book, article, e-zine, newsletter, radio, or television broadcast, podcast or in any other seminar teleconference or other events or publications please email or call the distributor of this guide.
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