When you’re looking at different finance options, making a final decision can be tricky. Money is the lifeblood of any business and can make the difference between success and failure. For many small business owners, this adds extra pressure to make the right choice. But with so many variables to consider, distinguishing between lenders may seem like a complex process. Interest rates and repayment terms are just the tip of the iceberg, so it’s important to look at the smaller details. In this article, we look at how to tell if a lender is a good fit for your business.
Avoid Pushy Sales People
Many lenders operate their loan offices like a sales department. Their teams have strict targets and get paid commission accordingly, which means they can be very pushy. This type of environment creates a culture where it’s all about closing the deal instead of doing what’s right for customers. For small business owners, this can result in feeling hassled instead of free to make a balanced decision.
You’ll easily be able to identify these lenders as you’ll get lots of phone calls from them at all hours of the day. They’ll put pressure on you to commit and may even demand paperwork that isn’t actually required, just to close the deal quickly. To avoid this, look out for lenders who’ll fit around your schedule and communicate on your terms. It’ll make the entire process much simpler and set a precedent for the business relationship going forward.
Think in Partnership Terms
One thing that can really set a lender apart is their ability to support your business. Do they have a long-term partnership mentality or do they take a short-term approach? Whereas some are only interested in the loan or cash advance, others will provide support beyond just the money. They can advise you on the best way to structure your finance or connect you with other sources of help. They’ll also have the interests of your business in mind because any good funder knows that your success is also in their best interest. The better your business performs, the easier it’ll be for you to repay the loan amount. So they should go out of their way to ensure your success throughout the entire process.
Compare the Small Print
Whenever you consider outside finance, it’s important to thoroughly read the small print. This means going through every line of the terms and conditions (even if it seems like a tedious task). Look at the key information such as interest rates and repayment terms so that you know exactly what you’re being offered and how much it’ll cost over the lifetime of the loan.
It’s also crucial to read up on the implications of something not going to plan. What will happen if you miss a payment? What if you can’t afford to repay it altogether or your business goes bust? This might sound dramatic, but it’s crucial to know what’s on the line. Some lenders may include collateral in the small print which means they can take your house, car, or equipment if things go south. But many lenders (including us) won’t require such security, which may make it the better option to go for.
If this sounds like a lot of information to keep track of, then use a notebook or simple spreadsheet to capture the details. Draw up a table so that you can record and compare the essential elements, including interest rates, total amount repaid, and any potential risks that you don’t like the sound of. This can make it easier to compare your options at a glance and make a sound business decision.
How We Can Help
Strategic Capital offers small business loans that support organizations across the USA. We don’t require capital which means that your personal and business assets aren’t part of the equation. If you’re in need of short-term financing, then we can help. Whether it’s to pay for emergency repairs to equipment or investing in expansion we offer small business loans without the need for collateral. Best of all, you’ll benefit from competitive repayment terms and low interest rates, so you have more money to reinvest in your business.
Transparency, innovation, and expertise are the driving factors behind everything we do. With a talented team of advisors, a plethora of funding partners, and the best technology available -we go above and beyond to help our clients receive their capital rapidly with the industry’s most competitive repayment options and interest rates. We want to break speed records, not bank accounts.
Upon submitting your application, it’s reviewed by a dedicated Capital Advisor. We generate the best rates and terms at lightning speed through our funding matrix and robust lender network. Yep… it’s that simple. Learn more about our small business loans here.
Checking for pre-approval will not affect your credit score.