For pretty much every business out there, money is the lifeline of the entire company, as are the customers who essentially bring in the money! So, what do you do when you run out of funding to progress in your particular industry? Well, you could sit back and try to stay afloat as other companies reach new pillars of success, or you could seek out a lender who can provide a little monetary aid with franchise financing. A business loan can be used for a number of things, such as to purchase new equipment, for promotion purposes or to carve out something entirely new based on a detailed business plan. If you are really serious about staying ahead of competitors, funding is a good idea. Whatever you plan on using the funds for, there are a number of essential things you should consider ahead of filling out the all-important loan application.
Information Required for a Business Loan
Don’t expect a lender to consider you eligible for franchise financing unless you can provide them with honest information about your financial status, credit history, business ideas, etc. Certain details will need to be supplied for the lender to determine how trustworthy you are in regards to paying back the money on time. You may be asked to provide information relating to business profits and losses, too. More losses than profits indicate you are not in the the financial position to pay back borrowed money.
How to Make the Process Easier for Yourself
There are a few things you can do to simplify the process of applying for franchise financing. The stronger your business plan, the faster a decision can be made. Education information, projected finances and bios should be included in this plan. Consider approaching banks and institutions that you have worked with in the past or that you know a lot about. Get in contact with a lending officer if possible and discuss documentation requirements with them, so that you don’t forget to bring anything to the meeting with whatever lender you choose to do business with.
Typical Business Loan Amounts
Your credit score will have a big impact on the amount of money your business can receive from the franchise financing institution. Start-up businesses might require more money to get the ball rolling, with median loan amounts ranging from $130,000-$140,000. Smaller amounts are available for businesses that simply want to update their inventory, invest in marketing or perhaps spruce up the interior of their business. Shop around but remember that the higher the amount loaned, the higher the interest rate will be.
