Business loan rates are all over the board. A business loan rates comparison can confuse current or would be small business owners due to the simple fact that the range of rates available can be so broad. The obvious underlying question however, is how one gets a loan that is at the lower end of that range. The following are 4 tips to help you land a small business loan with the lowest interest rate possible.
Prepare Before You Need a Loan
Of course for many it is too late for this, but even if you cannot do this for a current loan you need, it can be done now for any future financing needs. The fact is, the lower the credit score the more generous lenders tend to be with interest rates. Start working on credit now to ensure you have the best score possible when it comes time to get a loan. Get a free copy of your credit report and work through the items ensuring each one is right and proper. Question the credit company about anything you are unsure of, and appeal any incorrect information. In addition, work hard to meet obligations on time each and every month to keep any negative items from being posted to your credit report.
When it is time to look for a loan, it is important to know your credit score ahead of time. Some websites offer a free score from one credit company, but to receive scores from all three there is typically a charge. It is the individual’s decision as to which option to take, but most often scores do not vary more than a few points either way between companies. This information is valuable for a number of reasons, but when looking for low interest rate loans it can be used in a very specific manner. By researching and knowing the average interest rate for loans given to those with scores similar to yours, you can know whether you are really getting the best possible rate from a lender, or if you need to keep shopping.
While there is no guarantee, lenders do tend to look more favorably on those that offer a professional presentation. This includes both appearance and business plan or loan proposal, whichever is applicable. Dress professionally and either write or have written a professional business plan or proposal. It could make a real difference in not only interest rate, but even in whether or not you are approved for a small business loan at all.
Ask for Help
Sites such as Biz2Credit.com can save time and therefore money for lenders by matching them to one or more lenders in their network of over 1,100 that can best meet their needs. This cuts out a lot of the leg work and allows potential borrowers to narrow down their options faster. In addition, Biz2Credit can offer help in preparing a professional business plan sure to make the impression needed to ensure the best rate possible.
Don’t miss out on a better interest rate unnecessarily. Follow these simple tips to ensure you receive the loan you need at the best interest rate possible.
This article was submitted by Faith Stewart. Faith Stewart has a BBA with a major in accounting and spent 10 years working in the various aspects of accounting and finance before pursuing her passion for writing.