A healthy cash flow is crucial for the success of a small business, but it’s not always easy to come by. If you’re having trouble maintaining your cash flow, taking out a business loan or line of credit can be a quick fix.
Here are three important things to do when taking out a business loan:
1. Know your options: Before deciding where to apply for a loan, do some research and know your options. It may be easy to fall for a larger banking institution’s low rates, but don’t overlook smaller banks and credit unions. These smaller institutions will likely give you a better chance of being approved in addition to low rates and special offers.
2. Know your credit score: If your business is fairly new and hasn’t had a chance to establish its own credit score, lenders will take a look at yours instead. Know your score and make sure it demonstrates that you’re financially responsible and will be capable of paying them back. If it doesn’t, you may consider waiting until you’ve built up your personal credit before applying for a loan for your business.
3. Apply before you need it: It may seem unnecessary at the time, but it’s important to apply for a business loan or line of credit before you actually need it. Even the healthiest of companies use their line of credit from time to time when cash flow gets a little tight or they need to make a large purchase on behalf of a customer or client. While you (hopefully) will never need to use the money offered to you through a line of credit, you should still apply and have it available in case of emergency. Just like you buy an umbrella before it rains, you should always be prepared for a financial storm.
Telhio Credit Union offers both business loans and lines of credit to small business owners. For more on these alternative financing options, contact a Telhio business lender representative at 614-221-3233, option 6.
For more information about applying for a business loan, check out the article “7 Things to Do before Applying for a Business Loan” by Jenna White, who writes about business, marketing, credit cards and personal finance.
Telhio Credit Union is a full-service financial institution open to everyone who lives, works, worships, or attends school within Franklin County and surrounding communities. Founded in 1934, originally as the credit union for the Columbus Telephone Company, Telhio is a not-for-profit financial cooperative where its members are also its owners. Driven by its philosophy that members come first, Telhio is committed to the highest standards of responsibility and conduct. Telhio offers a variety of innovative programs, services and products to support its members’ financial needs. Telhio offers seven branch offices throughout Central Ohio and nearly 4,000 shared branching locations nationwide. Additionally, Telhio credit union participates in the highest level of combined federal and private share savings insurance available, insuring deposit accounts up to $500,000.*
*Federally insured by NCUA. Additional coverage up to $250,000 provided by Excess Share Insurance Corporation, a licensed insurance company.
