Therefore, business starts
up loans are designed specially to arrange finance to promote new
business. You can get funds ranging from £5000 to £500,000 with repayment
duration 05 to 25 Yrs
Following are the steps you need to follow
1. A solid business plan need to prepared and presented to lending institution
which includes budget , forecast and the reason good enough to convince the
lender to give advance
2. The presentation may be arranged where the borrower can convince why he
wants the finance. The lucrative business blueprint may be presented.
3. Check your personal finances as the lender closely examines them. The
probability of getting the finance reduces if there had been personal
bankruptcies or has a low personal credit rating. Credit rating of the owner is
considered because in the new set up credit history is missing. Difficulty
occurs in the case of large corporations and partnership.
4. You are required to fill in the application form and mention the principle
objective of the business and lender finds the deal that match to the details.
Therefore giving the correct details is required
5. The new concern cannot guarantee profits, which is generally considered
negative feature for financing. You can provide personal guarantee which may
not only guarantee the lender that the money would be returned on time
but also show your seriousness and commitment towards the business
New Business Loans is the
funding of the business, from proprietor’s salary, to solicitor’s fee, to
documentation cost, cost of plant and machinery and any other expenses related
to the business. Different options for different needs. It can be
segregated into secured and unsecured loan.
1. Secured-A valuable asset is given as collateral to get loan. A home for
example can be used as a collateral as it cant get you huge funds on its
equity. The repayment term is longer giving you good flexibility to repay
2. Unsecured-It is for meeting smaller business needs. The repayment term is
shorter and involved high risk for the lender.
Reference Link:- http://small-business.ezinemark.com/new-business-loan-venturing-into-new-business-is-now-easy-7d2e81806ddd.html
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