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You’ve worked hard, built your successful business, and now it’s time to expand. Maybe you’re thinking of opening another location, or you’ve just finished developing a new product that will take your business to the next level.

Unfortunately, taking advantage of these opportunities usually involves significant capital outlays, which you may not have available. Fortunately, the Small Business Administration offers a variety of programs designed to give business owners access to the financing they need. Below are a few tips for successfully securing an SBA loan.

3 Tips for Applying for an SBA Loan

1. Determine Your Needs

When applying for an SBA loan, make sure you know exactly what the funds will be used for and how you expect it to help build your business. The more information you have, the more likely the lender will be to approve your application. Knowing exactly what you expect to gain from the expansion will also help you decide whether applying for a loan is really the right move.

2. Check Your Credit Reports

sba loanYour personal credit history and business borrowing activity are among the most important factors determining whether or not the lender approves your loan. Get copies of your personal credit report, as well as your business credit history and check them over for errors.

3. Identify Your Collateral

Most commercial lenders, including those who offer SBA loans, require you to provide collateral worth 100% of the loan amount. Your collateral can be personal or business assets, such as cash, real estate, inventory, or almost anything else of value. Just be sure your expansion will generate enough to make the monthly loan payment, above your normal operating expenses.

 

For more than 100 years, Magnolia Bank has been dedicated to providing the Magnolia, Hodgenville, and Elizabethtown, KY, communities with friendly, personalized services tailored to the needs of your business. Follow their Facebook page for more updates and tips, visit their website for more about their commercial lending services, or just drop by your nearest location to apply for an SBA loan.

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