Small business loans have helped countless entrepreneurs, but certain errors can put them out of reach. If you’re applying for a loan for your small business, be sure to avoid the following mistakes.

Mistake 1: Not Being Accurate Regarding Finances

Lenders who extend small business loans will want to know where you and your company stand financially. Go into the application process prepared to produce transparent, up-to-date paperwork reflecting cash flow, assets, liabilities, and any other information a potential lender requests. 

Mistake 2: Not Knowing What the Money Is For

Before a lender hand out a cent, they will want to know what your business plans to use the money for. Whether you need to cover startup costs, production expenses, a new marketing venture, or another business expenditure, you should be able to explain where the loaned money will go — and how that will help your business thrive.

Mistake 3: Procrastinating

When it comes to applying for small business loans, procrastination is not your friend. The earlier you start, the more time you’ll have to prepare a rock-solid application and look around for the right lender for your business.

Mistake 4: Not Having a Business Plan

Lenders will want to see your business plan. A good one is a proof that you’ve thought your business idea through, while an absent or poorly prepared one is a huge red flag in the eyes of lenders.

Mistake 5: Giving Up

There’s a chance you’ll need to apply for multiple small business loans before you find a lender who is the right match for you. When rejection happens, try to look on the bright side: The lender may have saved you both from a disfavorable financial arrangement, and you’ll have a chance to strengthen your application before you approach another lender.

Seek Expert Assistance

Interested in small business loans or another form of financing? Contact TCF Capital to learn more about your options.