Small Business Loans

By Ilya Bodner

There is a tendency for people to think when bad news about the economy strikes the worst thing they could do is attempt to start a small business. This could not be farther from the truth. There is no such thing as a bad time to start a business, provided you go about it the right way.

Check the news again. When large corporations are failing and looking for bailouts, small businesses keep on ticking. A small business owner that keeps a tight rein on operations and serves the public with products or services valuable enough to be taken in exchange for money will survive a bumpy ride. 

Start Looking for a Lender Right Away      

Any "grey beard" entrepreneur that has made it through the economic swings that seem to part of a natural cycle will tell you not to invest every personal cent you have in your business when starting out. You need to protect your personal assets and savings to take care of yourself and your family while you are building your business income. Nobody will stop you from investing some of your own money, but include acquiring a business loan as part of your start up strategy.

There are some steps you will need to take to prepare for applying for a loan, and if you have already been rejected by the bank for a loan you have no choice but to pursuit another avenue.      

Do your market research and be certain the product/service you are about to put on the market is viable. Survey everything you are planning to do and make the adjustments as necessary. Give the market what it is willing to pay to have. Make a very detailed business plan.      

Choose the correct corporate structure for you business and register with the state. Get all your paper work in order and establish a proper bookkeeping system right off the bat. Find out exactly what your responsibilities are for paying taxes and retaining employees. Get your Employer Identification Number (EIN).      

Register with Dun & Bradstreet (D&B) for the purpose of getting a Paydex score. Look for all the ways you can get accounts under your business name and out of your personal name. Set up vendor reporting with D&B. Eventually you will need to get your hands on a list of businesses that extend lines of credit to small business owners and use those to start building your business credit score. You can get as much as $35k through business credit. Get a credit card in your business name and use it wisely.      

Money Available Regardless of the Economic Times

If you were expecting a magic formula to get an instant business loan, this is it. But it will take a little time. Depending on your diligence it could be a few weeks to a few months. No traditional banker or alternative lender will give you a loan with a decent interest rate without you doing these steps. You must build up your credit profile and business credit score first. It is the only way you can get money for your business that is not based on your personal credit and will not put your personal assets at risk. In the meantime you can use your business lines of credit from the list mentioned earlier to help get your business started.              

Article Source: $7.49 .com

About the Author: Over the course of the last 5 years as an entrepreneur I have successfully launched, managed, and sold off several businesses. Each organization started has added some value to my understanding of the business world today.

My philosophy has been that 9 things out of 10 that I try will fail, but that golden one is always worth the battle. In my experience that has proven to be the case and my successful businesses still operate today under the management of those whom I have sold off to. The latest project is Initial Underwriting Group, a corporation comprised of two concepts: 1) business credit building and 2) business loan underwriting.

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