One of the main requirements for submitting a business capital loan is the credit history of your business for the past time. Fund borrowers who have a good credit history have a great chance of getting approval from the lender. This is because, with a good credit history the lender is sure that you can make a payment right on time.
Meanwhile, companies that have a bad credit history will be more likely to be rejected when applying for a loan. However, that does not mean you who have a bad credit history cannot get a loan for your business. Even though your business credit is bad, you can make a number of attempts to convince the lender to agree to the application you submitted. How to? Check out the following tips!
Understand the Concept of Loans
Before you apply for a loan to a particular institution or lender, first understand the concept of the loan you want to do. Do you want to apply for a collateral or unsecured loan? It should be understood, this unsecured loan is more risky for creditors or lenders, so lenders tend to apply higher interest rates. However, you don’t need to give your valuables to the creditor as a guarantee.
Meanwhile, if you choose a collateral loan, you need to deliver the goods as collateral to the lender. This guarantee will be the creditor’s assets if you are unable to repay the loan as agreed. You will lose your valuables which are used as collateral for borrowing funds, if you are unable to pay the debt. All risk each of which you need to consider based on your ability to return it.
Meet a Credit Consultant
It’s quite difficult for those of you who have a bad business credit history when applying for a loan. Therefore, ask for help from a credit consultant to help you financially or emotionally. Credit consultants will be a bridge for you to get loans easily to creditors.
Credit consultants will offer services ranging from making more convincing data usage budgets, negotiations with creditors, loan payments, savings strategies, and so on. So, the credit consultant will help you convince the creditor even if you have bad credit.
Submit to several parties
Prepare documents as a complete loan application requirement. If the requirements are complete, try submitting a loan application to a particular party. If rejected by one party, try submitting it to the other party. Maybe it’s not easy to get approval from the lender. However, you can evaluate what caused your submission to be rejected and ask for the right advice so that the proposal can be approved.
Increase Business Revenue
While applying for loans to various parties, you can increase your business income by improving product quality and marketing strategies. This can help you increase income gradually. With increased returns you can pay off previous debts that have not been paid off. This will slowly improve your credit history.
Not only that, if your business income increases over time, it will be a positive value for your business in the eyes of creditors. This can increase creditor trust and consider your submission for approval.
Look for a suitable loan provider
If you are an SME actor who is looking for a small business capital loan, it is advisable to make a credit line loan. As explained above, loans with credit lines make it easier for you to carry out various transactions. In addition, you can also take money at any time as needed, so you can control the use of money.
Although it tends to have a high interest expense, this business credit line loan only charges interest fees that you have to pay according to what you use. If you can use the money as well as possible, then the line of business credit is the right solution for SMEs.
Look for unsecured fund loans that offer the easiest terms you can afford. So that makes it easier for you to get loan approval for your business needs. This is a review of the different lines of credit business with a business credit card that you can use to finance business development.