HOW TO QUALIFY FOR A BUSINESS LOAN
SMALL BUSINESS LOANS
Learn how to qualify for business loans and get insight on some great business loan options available for small businesses. Peach Capital Funding in Orange County is the top small business loans company offering fast funding for SBA loans, equipment loans and real estate investment loans.
The problem is startups often lack the business history and credit to land favorable term loans through banks. If you find yourself in such a situation, don’t panic. We have specific small-business startup loans that may fit your needs and goals to help you grow your business.
Here are some startup loan products, and the requirements you must fulfill to qualify for these types of business loans.
1. Equipment financing.
Equipment financing is a loan that enables you to purchase new equipment for your business by using the equipment itself as collateral.
There are several different advantages to equipment financing, including:
- Interest fees and other financing costs can be deducted from your taxes. You can use the depreciation of the equipment as a tax deduction as well.
- Since you use the equipment itself as collateral, lenders are more willing to provide financing to new businesses. There is less documentation needed in comparison to other term loans for businesses on the market.
Equipment financing generally requires a credit score over 600 with roughly $100,000 in annual revenue and 1 year or more in business. If your business is just starting out, you’ll likely need a higher credit score for approval from most lenders usually at least 680 or higher for a new business to get equipment funding loans approved.
2. Business credit cards.
A business credit card provides access to revolving credit. This is when the lender provides you with a large credit limit. This provides you unlimited access to capital as you grow and utilize your business credit cards for capital.
In addition to giving you access to funds, there are other advantages of using a business credit card.
- The ability to build business credit. Make your payments on time, and keep the balance as low as possible. Your business credit will improve, and you may be able to qualify for more favorable financing loans.
- Many business credit cards have sign-up bonuses. On top of that, continued spending with the card yields you even more benefits, from cash back to discounts on merchandise for your company.
- The ability to save more money. Some business credit cards offer 0% introductory APRs for 12 months or more. Giving you the option to fund early business operations, without incurring any financing charges.
Requirements for business credit cards vary with each business credit card and company. The best rewards, sign-up bonuses and introductory APR offers. The good news is other solid cards do exist if your personal credit score is lower, including those that offer cash back and better APRs.
3. Business Credit Line.
Building business credit is very important for any startup business. This leads to better financing options in the future and the ability to save more.
The benefit is that you can save time on the applications and get approval for a set of business credit cards, which gives you a higher limit.
Additionally, a business credit line is a powerful tool to get your business credit looking great. But to qualify, you must have great personal credit. Typically, you need a credit score of 700 or higher.
Use these startup loans wisely and you’ll see your business credit improve with time. That may open up better financing opportunities like an SBA loan which is known for their high amounts and low interest rate.
Explore your business loan options, crunch the numbers, and choose the business loan product that can get your company on the right path to success with the right business loan funding solution for your business.
Peach Capital Funding is here to guide you through the qualifying process for your business loan. Contact us today to start the process of qualifying for your business loan.