{"id":10733,"date":"2020-07-21T14:35:20","date_gmt":"2020-07-21T14:35:20","guid":{"rendered":"\/blog\/?p=10733"},"modified":"2020-07-21T14:35:51","modified_gmt":"2020-07-21T14:35:51","slug":"tips-to-improve-your-business-loan-application","status":"publish","type":"post","link":"https:\/\/tata-blog.osian.dev\/blog\/loan-for-business\/tips-to-improve-your-business-loan-application\/","title":{"rendered":"Tips to Improve Your Business Loan Application"},"content":{"rendered":"\n<p>Starting\nyour business venture or expanding an already established enterprise needs\nworking capital. A business loan is the ideal source of such funds. However, to\navail of credit, you must convince lenders about the profit potential of\nloaning money to your company. You need to present an excellent impression of\nyour business. Besides, you may also be asked to share the figures of your\ncompany to prove your repayment capacity. Here are some practical tips that can\nimprove your chances of securing finance.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Keep\nthe necessary documents ready<\/h2>\n\n\n\n<p>Lenders\nrequire your business details to understand the profitability of your venture.\nMaintain up-to-date accounting and tax records to make your business loan\napplication seamless. You can consider hiring a professional accountant to\nprepare the necessary documents. Also, check the lender\u2019s website for the\ninformation they need. Previous tax returns, articles of incorporation, profit\nand loss statements, and balance sheets are some common requirements. You will\nneed to furnish your KYC papers and KYC documents of your business as well.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Improve\nyour credit score before applying<\/h2>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"770\" height=\"400\" src=\"\/wp-content\/uploads\/2020\/07\/tips-to-improve-your-business-loan-application-2.jpg\" alt=\"\" class=\"wp-image-10735\" srcset=\"https:\/\/tata-blog.osian.dev\/blog\/wp-content\/uploads\/2020\/07\/tips-to-improve-your-business-loan-application-2.jpg 770w, https:\/\/tata-blog.osian.dev\/blog\/wp-content\/uploads\/2020\/07\/tips-to-improve-your-business-loan-application-2-300x156.jpg 300w, https:\/\/tata-blog.osian.dev\/blog\/wp-content\/uploads\/2020\/07\/tips-to-improve-your-business-loan-application-2-768x399.jpg 768w\" sizes=\"auto, (max-width: 770px) 100vw, 770px\" \/><\/figure>\n\n\n\n<p>Do\nnot apply for business loans when your credit score is low. Instead, work\ntowards improving your score with the following steps:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Avoid\nlate payments on existing debts<\/li><li>Pay\noff outstanding dues<\/li><li>Maintain\ncredit utilization ratios (around 25%)<\/li><\/ul>\n\n\n\n<p>A\ngood credit score builds up the investor\u2019s confidence in your financial\nmanagement skills. Avoid&nbsp;applying for&nbsp;multiple loans all at once.\nWhen you apply for a loan, a \u2018hard-inquiry\u2019 is placed on your credit score by\nthe lender that shaves points off the score. Too many applications can dent\nyour score significantly, thereby reducing your business loan eligibility.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Structure\nan actionable plan for your loan&nbsp;<\/h2>\n\n\n\n<p>Lenders\noften ask for a report that would detail how you intend to use the loan for\nbusiness. Express a specific purpose by clarifying reasons for taking the loan,\nsuch as:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Inventory\npurchase<\/li><li>Business\nexpansion<\/li><li>Equipment\nupgrade<\/li><\/ul>\n\n\n\n<p>Discuss\nhow the loan can improve your business profits. For example, show how updating\nequipment will increase productivity. A loan that can improve your sales will\nalso increase your repayment ability, making you an ideal candidate for the\nlender.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Project\nsufficient cash flow and improve your debt service coverage ratio (DSCR)<\/h2>\n\n\n\n<p>Promote\nthe investor\u2019s faith in the promising future of your business by detailing your\ncash flow projections. Illustrate your company\u2019s future income and expenses to\noptimize your loan application. Use your past cash flow statements and tax\nreturns to validate your predictions. Lenders will also consider your DSCR to\ndetermine the availability of cash to afford a loan. Here is how you can boost\nyour cash flow and increase your DSCR:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Remove\nunnecessary expenses<\/li><li>Cut\noverhead costs<\/li><li>Increase\nsales income<\/li><li>Pay\ninvoices on your business\u2019s name<\/li><\/ul>\n\n\n\n<p>Confirming\nenough cash flow and a high DSCR will reassure lenders that you will pay your\nequated monthly instalments (EMIs) on time.<\/p>\n\n\n\n<p><strong>Conclusion<\/strong><\/p>\n\n\n\n<p>It is essential to find a lender whose requirements align with your business\u2019 needs. Tata Capital designs loans with terms that can meet the specific demands of every business. You can apply for business loan online with Tata Capital and fuel the growth of your enterprise.<\/p>\n\n\n\n<div class=\"wp-block-button aligncenter\"><a class=\"wp-block-button__link has-background has-vivid-cyan-blue-background-color\" href=\"https:\/\/tata-blog.osian.dev\/online\/loans\/business-loans\/home#!\">Apply Now<\/a><\/div>\n","protected":false},"excerpt":{"rendered":"<p>Starting your business venture or expanding an already established enterprise needs working capital.  <\/p>\n<p><a href=\"https:\/\/tata-blog.osian.dev\/blog\/business-loan\/tips-to-improve-your-business-loan-application\/\n\">Read More<\/a><\/p>\n","protected":false},"author":1,"featured_media":10736,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"inline_featured_image":false,"footnotes":""},"categories":[26],"tags":[],"class_list":["post-10733","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-loan-for-business"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v20.13 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Tips to Improve Your Business Loan Application - TATA Capital Blog<\/title>\n<meta name=\"robots\" content=\"noindex, nofollow\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Tips to Improve Your Business Loan Application - TATA Capital Blog\" \/>\n<meta property=\"og:description\" content=\"Starting your business venture or expanding an already established enterprise needs working capital. 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