Lender Tip of the Week – The Top Criteria for an Application-Only Loan
When it comes to helping companies get small businesses loans, Fundera wants to make the process as easy and transparent as possible for borrowers. Not only do we cut down on the amount of paperwork, but we also find new ways to inform and inspire small business owners.
This is the latest in an ongoing series in which we ask our trusted partners to share their best lender tips for prospective borrowers.
This week, Martin Franco, the Director of DLJ Financial’s Equipment Finance and Business Capital Division, shares the top criteria for financing.
There are two primary types of loans, Franco says. First, there’s application only, which is pretty straight-forward. The lender doesn’t check your financials; instead, they’ll look at your time in business (which needs to be a minimum of three years) and then — and this is especially important if you’re a startup — your personal credit score (which needs to be at least 660).
Depending on how much money you need to finance, they might look at how much money you have in your business bank account. If you’re financing less than $50,000, they don’t really care. If it’s more than $50,000, you might need to provide two to three years of tax returns and a personal financial statement. Lenders will also want to know if you own a house.
On the other hand, the other type of equipment lease requires full financial disclosure. Lenders expect you to be profitable to qualify for this type of lease, but it comes with a better interest rate.
Here’s What Donald Trump Has to Say About Small Business
Meredith Wood / Oct 14, 201628
When This Entrepreneur Lost 100 Pounds, He Knew His Coconut Business Would Succeed
Meredith Wood / Sep 9, 201614
Want Free Money? Check Out This List of the 107 Best Small Business Grants
Ben Rashkovich / Dec 15, 201511
3 Secrets Behind the Economics of Running a Successful Liquor Store
Vivian Giang / Nov 17, 20158
Here's What Hillary Clinton Has to Say About Small Business
Meredith Wood / Oct 10, 20168