Getting a small business loan in Canada might seem daunting to some people. Merely the thought of going to a loan office and presenting a business proposal can send even the strongest and sturdiest of business owners scrambling back home. If you actually think it over, it is not that difficult and certainly not impossible if you are just prepared well enough ahead of time.
To get the deal, you need to put yourself in the creditor’s shoes. There will certainly be questions, so you need to anticipate these. The two most important questions they might ask you is “What makes you a good risk?” and “Why should they lend you their money?” It really is understandable considering that for a small business loan you are not just talking about a small amount of money. Of course the investors would want your business to succeed and to ensure that there is a healthy return of investment. Preparing for these questions would be the first and vital step in getting that loan.
Signing that contract would also mean that you might need to present a small business presentation. So you need to get your proposals in order, showing them reasonable charts and graphs, and even the risks you are expecting. You might also need to show the investors that you are willing to invest your own money into this business. Nothing says that you are more serious and dedicated than your willingness to involve yourself in the risk. You also need to prepare collateral for this loan. In Canada, collateral can be property, car, and even a piece of equipment. They can be used to offset the difference between the loaned amount and the payable amount should your business take a turn for the worst.
Aside from your business proposals and collateral, you also need to prepare beforehand your credit report. Big loaning companies can easily search for your credit report using their tools; on the other hand if you prepare it before the meeting, it shows them that you have also reviewed it and that you are well aware of your credit score. At this point, do not fret if you have a low or unhealthy score. When you get your credit score and it is unsatisfactory, you are also given options how to repair it and raise it to a satisfactory level.
With these materials in tow, it should boost your self-esteem as you give your business proposal. Years ago, you had to wait for a few days, sometimes even weeks before you could get the results for your proposal. Nowadays, hopeful applicants can get the results within a few days only. Some banks and bad credit lending companies in Canada even give it after a few hours!
That means that cinching the proposal might be the most difficult part, but it is the most crucial and most important part. It is also the only thing you need to worry about. After you get the loan, the next thing you have to worry about is just maintaining your business and keeping it above sea-level. It does not take rocket science to do it after all.