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3 Critical Mistakes to Avoid When Taking Out a Business Loan

business managers discussing loan requirements in a meeting

Are you considering taking out a business loan? As you fund critical business activities and projects, you’ll generate more revenue and tap into immense business growth. Before you begin, make sure you partner with an experienced loan agent and build a custom package that meets your requirements. In this blog, we’ll walk you through three critical mistakes that must be avoided when taking out a business loan. Keep reading.

1. Walking In Without a Plan

Make sure you have a concrete plan before you meet with a loan agent. You should have a clear vision for your business. How much funding do you require? Which activities would you like to fund? Do you have a clear idea of the expected revenue growth? Do you have a mitigation and contingency plan in place?

You should know exactly where your company is headed and what you would like to achieve. If you’re not confident and clear about your business plans, the lender will feel uneasy about offering you a loan. The more comprehensive and robust your plan, the better. You should be able to communicate your vision without hesitation.

2. Lacking the Right Documentation

If you’re interested in taking out a loan, gather the relevant documents. You’ll be required to submit three months of bank statements. Make sure you possess documentation related to your address, income, KYC, details of establishment, and so on.

Every lender has different requirements. Before you meet with them, ask them for the documents they would like you to bring. This step will save you a lot of hassle later on. The documents should be accurate, not forged.

If you’re worried about getting rejected for a loan, you may feel tempted to manipulate some information. Avoid doing this. If the lender finds out, they’ll reject you outright. Most lenders share this information with other lenders. Your chances of landing a good business loan will decrease significantly. Be honest and go prepared.

3. Being Unrealistic

If you’re applying for a business loan, ensure you have realistic expectations. Loan agencies have a loan amount limit, defined terms, and other requirements. You can request flexibility, but you can’t expect a dramatic increment.

At Whitestone Fund, we offer a short-term business loan amount between $5,000 and $500,000. The repayment timeline is between 6 and 18 months, with daily or weekly payments. Our cash advances are up to $1,500,000, with payments every week or every two weeks.

At Whitestone Fund, we provide safe, secure, and swift small business loans in Yonkers, NY. As one of the most reputable short-term business loan and cash advance providers in NYC, we offer excellent loan terms, variable loan amounts ($5,000 to $500,000), and fast fund provision.

If you’re looking for quality business financing in NYC, give our business loan agents in NYC a call today! You can also submit an online application.

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