Seven To Ten

1. Check your DUNS number

It’s a nine-digit identification number assigned by credit-rating company Dun & Bradstreet (DNB) that lets banks and other potential lenders see a snapshot of your company’s bill-paying history and general financial stability. To apply for one, go to D&B’s website and, under Customer Resources, click on “Get a DUNS Number.”

2. Clean Up Personal Credit History

Have a pristine personal credit history. For small firms, you are usually the guarantor of any loan a bank extends to your business, a loan officer will scrutinize your credit record. People who don’t honor their personal commitments generally don’t honor business commitments either. Macieira-Kaufmann notes.

3. Your planned use for the loan

Banks love to see a business purpose likely to boost revenues. They are also impressed if you’ve invested a significant sum of your own money in the business. It shows you have a stake in its success.

4. Cash Flow and Profitability

When it comes to your repayment ability, a bank checks out your firm’s cash flow and profitability. The issue of collateral doesn’t really come into play with small business loans, which are usually unsecured.

But in service businesses with few material assets, banks do sometimes consider accounts receivable to be a form of collateral.

5. Geographic location

The location of your business and the general economic condition, your industry and whether it’s growing.

6. Deposit Balances

It always helps to have your business account at the bank you hope to borrow from.