• Contact Us
  • Privacy Policy
Thursday, June 30, 2022
ZAPlaylist
  • Home
  • Music
  • Album
  • Mixtape
  • EP
  • Playlist
  • E-News
  • Contact Us
No Result
View All Result
  • Home
  • Music
  • Album
  • Mixtape
  • EP
  • Playlist
  • E-News
  • Contact Us
No Result
View All Result
ZAPlaylist
No Result
View All Result

How To Confirm If Your Business Is Eligible For A Commercial Loan

Boss by Boss
May 17, 2021
in Business
0
How To Confirm If Your Business Is Eligible For A Commercial Loan

How To Confirm If Your Business Is Eligible For A Commercial Loan:

If your business, like many of the enterprises worldwide, has been deeply affected by the pandemic, you may rely on a commercial loan to finance your operations. Crisis or not, business loans are believed to be critical support for businesses, whether small or large. 

Loans, which are used for funding specific business operations and expansion, are known to be crucial in starting, running, and expanding any kind of venture. In some cases, it may not be even possible for some companies to run seamlessly without the help of commercial loans. From property or asset acquisition to research and development, a business loan could fund various activities that a company may not afford to pay. 

When looking for commercial loans, small businesses often go to banks and lending institutions. However, they could get intimidated or be too afraid to ask questions about the application process, the requirements, and how to increase the chances of getting approved. If you think you’re ready to take the plunge, take heed of the following points to know whether your business is eligible for commercial financing. 

Eligibility Requirements Vary

Lenders, whether banks or government-run lending agencies have various requirements, rates, terms, conditions, and fees. However, with the Covid-19 pandemic, some institutions may have become less stringent in terms of accepting and screening commercial loans.

Financial institutions have programs that suit a specific borrower from a particular sector, and these programs also dictate changes in criteria. For instance, while most agencies prefer to lend to established businesses, some may offer special loans to fresh businesses. Hence, another set of requirements in lieu of business financial reports may be required. 

What Makes Your Business Eligible For A Commercial Loan?

To know if you qualify for a commercial loan, it’s best to contact the lending institution. However, you could perform a self-assessment by considering the following common lending qualifications: 

  • Impressive credit score: Banks and lenders generally take into account the borrower’s business and personal credit scores. Because building a credit history takes time, startups may not have enough credit score to support their application. In this case, lenders would normally ask for a guarantor. Ideally, a borrower’s credit score should be more than 600 to qualify for a loan.

You may read this informative post about the importance of having a favorable credit score before applying for a loan.

  • Solid business plan: Financial institutions would normally require borrowers to have a sound business plan, partly to assure them that you’re capable of paying your debt. A good plan entails a clear explanation of why you need the money and how you’re going to spend it to provide stability and increase revenue streams.   
  • Stable income streams: Lenders would want to make sure they’re going to be repaid. If you’re availing of an unsecured loan for your business, you might need to prove that your business income could cover your business operations and debts, including the projected monthly fees for your commercial loan.
  • Sufficient business experience: Some lenders would require the business to have been in operation for a specified period. The most common eligibility period for commercial loans is a two-year operational requirement. Some lenders may be less strict and would consider enterprises that have been operating positively from as early as one year before the application period.    
  • Ample net worth: Banks commonly look social resilience of the business, as well as the business owner or guarantor. If there are not enough business assets to offer, the principal borrower may have to show they have liquid assets.   

Commercial loan lenders may ask borrowers to put up collateral for a secured loan. Most financial institutions may provide secured business loans of up to 75% loan-to-value (of the collateral). But these happen only in exceptional cases. A likely scenario would be entering into a purchase money deal, where you’re buying the property and using it as collateral for your business financing.  

  • Current amount of debt: Apart from your net worth, lenders would likely look at your business and monthly debt-to-income ratio. This would give them a better perspective on your capacity to pay. Hence, even if you have a favorable credit score but have other active debts, lenders may not view your application positively.   

Some lenders would require borrowers to have a debt-to-income ratio of 50%. The lower the rate is, the better. 

Final Thoughts 

There are various commercial financing products being offered in the market these days, and it can be confusing which one is best for your business. Before applying for a commercial loan, it’s best to perform due diligence and ask around. Doing this may further delay the already time-consuming application process, but it’s all well worth it.      

Previous Post

How Professional Book keeping Can Boost Your Business

Next Post

How to Utilize Business Loans to Successfully Scale Your Business

Next Post
How to Utilize Business Loans to Successfully Scale Your Business

How to Utilize Business Loans to Successfully Scale Your Business

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

No Result
View All Result

ALBUM

DJ Clen – It’s a’Bow Time Album ZIP Artwork
Album

DOWNLOAD ALBUM: DJ Clen – It’s A’Bow Time (ZIP File)

by Boss
June 28, 2022
0

DJ Clen – It’s A’Bow Time Album ZIP Download Stream and download DJ Clen – It’s A’Bow Time Album ZIP...

Read more
DJ SK – Uhambo Lwam (My Journey) Album ZIP Artwork

DOWNLOAD ALBUM: DJ SK – Uhambo Lwam (My Journey) (ZIP File)

June 24, 2022
DJ Maphorisa & Kabza De Small – Scorpion Kings Live Sun Arena EP ZIP Artwork

DOWNLOAD EP: DJ Maphorisa & Kabza De Small – Scorpion Kings Live Sun Arena (ZIP File)

June 23, 2022
Dj Jaivane – Xpensive Celections Vol 42 Album ZIP Artwork

DOWNLOAD ALBUM: Dj Jaivane – Xpensive Celections Vol 42 (ZIP File)

June 17, 2022
Tman Xpress – Ikigai Album ZIP Artwork

DOWNLOAD ALBUM: Tman Xpress – Ikigai (ZIP File)

June 17, 2022
Prince Kaybee – Gemini Album ZIP Artwork

DOWNLOAD ALBUM: Prince Kaybee – Gemini (ZIP File)

June 16, 2022
Kabza De Small – KOA 2 Part 2 Album ZIP Artwork

DOWNLOAD ALBUM: Kabza De Small – KOA 2 Part 2 (ZIP File)

June 16, 2022
Kabza De Small – KOA 2 Part 1 Album ZIP Artwork

DOWNLOAD ALBUM: Kabza De Small – KOA 2 Part 1 (ZIP File)

June 16, 2022
Moonchild Sanelly – Phase Album ZIP Artwork

DOWNLOAD ALBUM: Moonchild Sanelly – Phase (ZIP File)

June 9, 2022
Dr Feel – Made In Africa Album ZIP Artwork

DOWNLOAD ALBUM: Dr Feel – Made In Africa (ZIP File)

June 9, 2022

Recent Posts

  • Watch the Moment DJ Maphorisa Shares Money to Random Fans on the Street
  • Kaleido & T&T MusiQ – Yizo Yizo ft. Sonini
  • Mellow & Sleazy & Chley – Wenza Kanjani Ft. 2Woshort, TNK Musiq & Boontle RSA
  • Mlindo The Vocalist Previews New Song with DJ Maphorisa & Jumaima
  • DJ Maphorisa Responds To A Claims That He Made Kabza De Small Who He Is Today




  • Home
  • Music
  • Album
  • Mixtape
  • EP
  • Playlist
  • E-News
  • Contact Us

© 2021 ZAPlaylist

No Result
View All Result
  • Home
  • Music
  • Album
  • Mixtape
  • EP
  • Playlist
  • E-News
  • Contact Us

© 2021 ZAPlaylist

We use cookies on our website to give you the most relevant experience by remembering your preferences and repeat visits. By clicking “Accept”, you consent to the use of ALL the cookies.
Cookie settingsACCEPT
Manage consent

Privacy Overview

This website uses cookies to improve your experience while you navigate through the website. Out of these, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may affect your browsing experience.
Necessary
Always Enabled
Necessary cookies are absolutely essential for the website to function properly. These cookies ensure basic functionalities and security features of the website, anonymously.
CookieDurationDescription
cookielawinfo-checbox-analytics11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Analytics".
cookielawinfo-checbox-functional11 monthsThe cookie is set by GDPR cookie consent to record the user consent for the cookies in the category "Functional".
cookielawinfo-checbox-others11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Other.
cookielawinfo-checkbox-necessary11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookies is used to store the user consent for the cookies in the category "Necessary".
cookielawinfo-checkbox-performance11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Performance".
viewed_cookie_policy11 monthsThe cookie is set by the GDPR Cookie Consent plugin and is used to store whether or not user has consented to the use of cookies. It does not store any personal data.
Functional
Functional cookies help to perform certain functionalities like sharing the content of the website on social media platforms, collect feedbacks, and other third-party features.
Performance
Performance cookies are used to understand and analyze the key performance indexes of the website which helps in delivering a better user experience for the visitors.
Analytics
Analytical cookies are used to understand how visitors interact with the website. These cookies help provide information on metrics the number of visitors, bounce rate, traffic source, etc.
Advertisement
Advertisement cookies are used to provide visitors with relevant ads and marketing campaigns. These cookies track visitors across websites and collect information to provide customized ads.
Others
Other uncategorized cookies are those that are being analyzed and have not been classified into a category as yet.
SAVE & ACCEPT