By 
Before applying for a loan, you must be able to answer the following questions about your business:
- How has my SME operated since it was created and how has it behaved recently?
- What are my business expectations in the short term?
- Have profits increased, remained constant, or decreased?
- What is the financial status of my company today?
Remember that it is very important to be realistic and know the details of your business in depth. However, consulting with a professional SME loan broker Singapore will help you avoid the mistakes that many entrepreneurs make when requesting this type of loan.
Common mistakes in applying for business loans
There are many errors that can limit your access to credit for your company or commit it to a payment that will be a burden in the long term.
Maintain a bad credit history
Financial institutions will investigate past commitments that involved a loan or credit payment. Your financial history classifies your business as viable or unfeasible for any line of financing. If you have kept up to date with other previous commitments, it is easier for a SME loan broker Singapore to grant additional benefits to your business.
Combine personal credits with business credits
Your business needs to grow based on its own credit history. Sooner or later, if you use personal loans for your company, you will eventually exceed the financial resources associated with the assets of your SME and that will reduce its financial stability. Remember that all business credit must generate profits to find the funds to pay it off as soon as possible.
Apply for the same type of credit more than once
In case any financial institution denies you the credit you are looking for, it is not convenient to go to another financial institution, hoping for a better answer. The recommendation is to wait a period of 15 to 20 days to apply again. On the other hand, try to make things right responsible for the rejection.
Who can grant me a business loan?
There are many credit institutions that you can go to. They differ by the type of loans and vary in terms and interest rates that they generally grant. Among them are:
- Banks,
- Popular Financial Societies,
- Cooperative Savings and Loan Societies,
- Multiple Purposes Financial Companies.
As we already mentioned, do not make hasty decisions but lean towards the one that offers solutions that adapt to the particular needs of your business. Remember that planning is better than regretting.
The priorities of your company –
Make sure that the amount of the credit is not more than 30% of the real profits of your company or you run the risk of paying the debt with your own resources. Sometimes when interest rate is low, it is possible to be tempted to apply for a business loan, even if you don’t need it. Don’t get emotional, later it becomes more expensive. However, if you need a loan, carefully evaluate each aspect, talk to the experts, compare the financial institutions, interest rates, terms and conditions, etc. After a right decision, go for the final step.
