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After investing time, money, and passion into your startup, you’re ready for the next level of growth. While your company has several employees and few assets, it’s going to take some extra capital. Luckily, a small business loan can fill in the gap. If you’re applying for one at a local bank, here are several tips that may work in your favor. 

4 Tips for Getting a Small Business Loan

1. Be Specific on the Loan’s Use

Before applying, write down the exact reasons why you want the loan. For instance, will the funds be used to purchase a bigger commercial building or a new van? Provide an explanation and documentation supporting the need for the additional resources. 

2. Get Your Paperwork in Order 

local bankAs a small business owner, you take pride in having meticulous accounting records. The lending officer at the local bank will want to see them, along with business tax returns over the past three years and quarterly and annual financial reports. Put together a file that clearly shows how your company is faring.

3. Go Local

Consider applying for a business loan at a local bank. These community lenders often make their decisions in-house instead of through an out-of-state call center. They’ll look at your unique circumstances rather than taking an impersonal, cookie-cutter approach. If you have existing accounts at the bank, these relationships may also be an advantage.  

4. Pay Down Outstanding Debt

Ideally, you don’t want to be overextended in debt when applying for a business loan. If this is the case, take the time to pay down outstanding credit card balances and other obligations. Like mortgages and other loans, lenders want to see a certain debt-to-income ratio. They prefer to ensure the loan payments can be paid without putting you in financial straits.

 

Putnam 1st Mercantile Bank in Cookeville, TN, takes pride in assisting local small business owners with their growth plans. This includes providing a range of loans and making decisions in-house with fast turnarounds. If your company is ready to expand but is need of funds to make it happen, call the local bank at (931) 528-6372. A friendly lending officer will be glad to meet with you and offer personal attention. Visit the website for details on the full suite of products and services.

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