Funding a Business of Your Own

Are you looking for a small-business loan to fund a business of your own? Consider some of the advantages of working with your local credit union, which is not for profit and owned by its members, rather than a bank. 

Here are some benefits of obtaining small-business loans from a credit union and smart tips to increase your chances of loan approval.

Willing and Able to Lend Money

Credit unions are, from an underwriting perspective, more flexible, fully engaged in the market and willing and able to lend money to small businesses. Since credit unions are not for profit institutions whose owners are their customers and not stockholders, they don’t have to pay dividends.

At credit unions, financial products such as credit cards, home equity loans, mortgages and auto loans typically come with lower interest rates than what you would find at a bank. While credit unions review small-business loans just as stringently as other financial institutions do, they also take into account their relationship with the business owner and the community they serve.

Of course, credit unions don’t just give away business loans to all members. If you want to increase your chances, there are two things to consider before applying.

Show That You Can Repay the Loan

Before applying for a loan as a small-business owner, it’s smart to have a clear understanding of exactly what type of loan you want and why you need it. If you are unsure, that’s okay, but the more information you have, the easier the process will be. Then, be prepared to show how you’re going to be able to generate the necessary cash flow to repay the loan.

Have a Solid Business Plan in Place

It’s important to have all of your financial documents organized and a business plan ready to submit before applying for a loan. We understand that making a business plan can seem like an overwhelming task so we can offer assistance with this.

Generally speaking you will be asked for three years of federal tax returns and a personal financial statement. A detailed business plan is something every lender will look for, so you need a road map and a plan as to how you will repay the loan.

Friendlier fees, competitive interest rates and measurably better customer service are just a few of the viable reasons to become a member in your local community credit union.