You know everything there is to know about the business you want to start, demand, the market, competition, and more. What else could you possibly need to know? Sometimes the most obvious questions are the ones that are the hardest to answer simply because we haven’t thought about it enough ahead of time.
For What Do You Want the Money?
To start your business, right? Well, yes, but why are you choosing financing rather than some other funding option? The answer is probably that you do not have the disposable cash, no family willing to lend or gift it, or simply that you want to finance for cash flow purposes. It is a simple enough question with a simple enough answer that takes a surprising number of would be borrowers off guard.
How Will You Spend It?
You are going to spend it on starting your business of course! Lenders need more than that, however. They will want to see a detailed budget with specific line items stating how much of the funds will be going toward each cost. For example, you may be going to spend $5,000 on finishing the building, $20,000 on equipment, and $3,000 on marketing. They want to see that.
What Are You Willing to Give?
How much of the budget are you willing or able to come up with on your own? How are you going to come up with it? Rarely will a lending institution fund 100% of a budget. Banks and other lenders will require a percentage from the borrower, and they will want to know from where the borrower’s contribution is coming. In other words, do you have “skin in the game”?
While these question and answers seem obvious, they are important nonetheless. If you consider these things ahead of time you can easily be taken by surprise. Don’t let that happen. Get prepared and then visit Biz2Credit to get in touch with a loan specialist who can help you prepare your loan application. Consultations are free.
Biz2Credit offers all types of funding options — unsecured business startup loans, veterans loans, loans for women, microloans, and loans against luxury assets.