{"id":17059,"date":"2021-11-20T08:57:33","date_gmt":"2021-11-20T08:57:33","guid":{"rendered":"https:\/\/www.openbusinesscouncil.org\/?p=17059"},"modified":"2022-03-24T03:02:39","modified_gmt":"2022-03-24T03:02:39","slug":"personal-finance-steps-to-take-before-applying-for-a-business-loan","status":"publish","type":"post","link":"https:\/\/www.footballthink.com\/personal-finance-steps-to-take-before-applying-for-a-business-loan\/","title":{"rendered":"Personal Finance Steps To Take Before Applying For A Business Loan"},"content":{"rendered":"
You want to start a business. Unfortunately, you don\u2019t have enough capital of your own to begin your venture. So, like most entrepreneurial hopefuls, you consider applying for a small business loan<\/a>. The hope is that your local bank or credit union will loan you the money you need to launch and manage your business until you start generating revenue. The only issue is you\u2019re worried about your approval chances.<\/p>\n Borrowing money from a bank or credit union isn\u2019t easy. Applicants need to have a solid financial history, a low risk level, and the ability to repay the loan on time. If you\u2019re deficient in any of these areas, acquiring startup funds is challenging. Fortunately, you can take personal finance steps to increase your chances of getting approved for funding. Check out these tips below.<\/p>\n <\/p>\n Trying to apply for a small business loan with high debt will likely result in a rejection. That\u2019s because lenders assess your financial obligations to determine whether you can feasibly repay the loan. If you have too many debts, your monthly income is stretched thin, ultimately decreasing the likelihood of timely repayment.<\/p>\n Whether you have a ton of student loans, medical bills, or credit card accounts, you need to get your debt to income ratio and utilization rate down to 30% or less. You\u2019ll find that there are plenty of suggestions on how to pay off credit card debt<\/a> and other financial obligations. You can refinance, create a repayment plan, or negotiate with creditors, to name a few.<\/p>\n Your credit history is reviewed extensively by banks, credit unions, and private lenders to determine your financial responsibility and risk level. If your credit report is riddled with negative marks and your score is low, you should clean things up before applying for a small business loan.<\/p>\nReduce Your Debts<\/h2>\n
Clean Up Your Credit<\/h2>\n