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If you're one of the many small business owners who have just been turned down for a loan, don't despair. Rejection feels like the end of your dreams, but it's often just the start of a wiser financial path.
The reasons lenders deny business loans are usually common: low credit, poor cash flow, debt, incomplete documents, or brief business history. For small business owners, particularly startups, it is a frustrating but correctable setback.
Here's how to regain control:
Ask for Feedback: Lenders will typically inform you why your application was declined. Utilize this knowledge to improve yourself before reapplying.
Repair Your Credit: Fix your credit score and pay outstanding debts.
Revise Your Business Plan: Make it detailed, up-to-date, and cash-flow oriented.
Seek Alternative Funding: Check out online lenders, microloans, invoice financing, or SBA-backed loans.
Improve Financial Records: Clean, consistent books make a gigantic difference.
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