What do banks look for when approving a business loan?

What do banks look for when approving a business loan?

 

The most common things that banks and lenders look for when approving a business loan is your business health, including your financials and cash flow.

It’s important to ask yourself, “do you have enough money coming into the business on a regular basis in order to repay a loan?”

For many online lenders, they will look for around a monthly revenue of $7,000 to $10,000 to be considered for business financing.

Another important factor lenders look at is how long you’ve been in business. If you’ve only been in business for a few months, even if you are making, say $15,000 a month, it’s still not a long enough track record to feel safe and secure to lend you money.

Companies are all different and thus there exists a need for different business loan types to suit the different needs companies face. Explore the different types of business loans here!

There are literally dozens of areas that a business may need professional help in. If you’re wanting to grow your business and feel there may be opportunities to outsource some tasks or improve existing technology, review these top solutions and vendors for businesses in Canada!

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Vlad Sherbatov

Vlad is the President and Co-Founder of Smarter Loans, Canada's original and largest loan comparison website. He is a passionate entrepreneur and business leader in the Canadian financial sector. He was selected as a 2019 Top 25 Leaders in Lending by the Canadian Lenders Association. Vlad is an author at Smarter Loans, and has been featured in publications like the Toronto Star and National Post, among others.