A small business owner may find himself in a situation when he needs cash immediately and does not from where to get it. First, available source is not the one to jump at in such circumstances since the unscrupulous lender may charge fees and a higher rate of interest that adds to the cost of borrowing and results in higher repayment. A wise businessman, even though he needs funds urgently, asks some questions before signing on the dotted line.
Ask him how much he really needs, for what purpose and can he repay it
It is easy to take money when it is offered without any security. However, one of the first questions to ask when choosing small business funding is not the interest or charges but whether the borrower can manage the extra repayments without disturbing his cash flow.
How fast money is made available?
One of the main purposes of small business funding is to get money and get it fast. Ideally, money should be in the bank account of the borrower within 3 days of submitting an application online or offline. In reality, it may take 4 days or so.
The terms of financing?
The biggest burdens of small business finance are the fixed charges, service charges, and the interest rate. The interest rate can be crippling. One must look for a lender who charges a reasonable rate of interest and waives any fixed charges. Another of the terms to look at is the repayment schedule. Considerate lenders are flexible and offer customized terms to make life easy for the borrower.
Does the lender offer to finance for small business with bad credit? Do they ask for collateral? Lenders who are pro-borrowers will not insist on the borrower having a credit score of 700 or higher. Even businesses that are facing temporary setbacks with poor credit should be eligible. Collateral is another thing that should not be insisted upon because, as any lender knows, people who opt for this type of financing usually have their property mortgaged or under lien. Select lenders with an understanding approach to eligibility criteria.
What happens if unforeseen events impede regular repayments?
Get this clear before making a commitment. Some lenders can be quite rigid. Others, such as wscapnow, are more considerate and will have workarounds to manage contingencies. A lender who is interested in seeing his client grow rather than simply making profits is the one to select. If that lender also offers consultations then it is so much better for the borrower.
It has been noticed that thoughtless selection of a source of small business capital often results in more problems cropping up that could be difficult to handle. Obtaining clarifications before selecting a source of finance is worth the effort, not only in the short term but also for long-term business growth. Wscapnow and its team, with experience and knowledge of markets and all possible scenarios, go all out to assist their clients to fulfill their purpose when they seek such finances.
Blog Source: http://www.wscapnow.com/blog/