Prepare For The Loan Application Process And Increase Your Approval Odds

If you are a whiz in the kitchen and have always wanted to own a small restaurant, take your talent to a higher level by applying for a business loan to acquire funding for the new venue. The following tips will assist with preparing for the application process and increasing your loan approval odds:

Create A Solid Plan

Sit down and ponder how you would like your restaurant to look and equipment or food products that will be needed to open a business. Take into consideration that you will need to hire staff members, purchase uniforms, and promote your business soon after it opens. Write down expenses that are necessary to acquire a building and materials to transform its interior into the restaurant that you desire. When meeting with a lender, provide them with the plans and clearly explain how you will utilize money if it is lent to you.

Check Your Credit And Explain Lack Of Accounts Or Negative Marks

Check your credit through one of the main credit bureaus to determine what your credit score is and if negative marks have been made on your existing credit report. Print out a copy of your credit report so that you can study it in depth prior to meeting with a lender. If you are lacking credit, you can explain to a lender that you are just starting out and haven't had the opportunity to acquire credit due to your inexperience.

If there are any negative marks on your credit report and you have a valid reason as to why this is, such as being unable to make payments on time due to a serious illness or the loss of a job, discuss the reasons with a lender so that they have a clearer picture of your past credit history.

Acquire A Cosigner Or Put Up Collateral 

If your credit is severely damaged and a lender won't be able to approve a loan, based solely on your creditworthiness, consider asking a friend or family member to co-sign for a loan for you. If nobody is willing to take a risk like this, maybe someone will be more apt to cosign if you agree to make them your business partner.

If all else fails and you can not get anyone to vouch for you, ask a lender if you could put up some collateral in order to receive the funds needed. If you own a residence, vehicle, jewelry, or any other assets you may be able to agree to list them on your application as collateral in order to receive approval for a loan. 

Contact local business lending solutions for more information and assistance. 

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