As a former veteran employee of Dun and Bradstreet I learned that the intricacies of borrowing money (behind the scenes) is far from what are the perceptions of everyday business owners.
This is disturbing on many levels because #1, business owners flock to banks to borrow money with many myths and #2 those that actually do get funded, usually credit luck.
And, you know what? The answer is so simple that only a handful of business owners have an understanding of it.
You see, the majority of us live in a reactive society. Your car breaks down, you take it in for a tune-up. Perhaps you got sick and finally go for that checkup that you should have gone to many months before.
The key in loans is not to borrow money when you need it - do it when you don't need it. However, business owners who are now in need of that cash-flow burn through their personal credit to secure their lines of credit - if they get it - again, this is the thought process which leads to the inevitable downfall.
The key of course is to make your business become "Lender Compliant" Even if you just started a new business, if you structure your company the way lender's can relate to it, they will invest in your business with legitimate loans.
So what should I do?
- Go to# http://www.dnb.com/# and start working on your business credit. Be careful as to what trades you add to your report as that can potentially affect your rating. You also want to be careful of the type of address and phone number you are using as those can be some of the mitigating factors that affect scores and ratings. You need to D&B with most lenders to be considered for loans, but you DO NOT require D&B to actually secure that loan. Your FICO will usually be that determining factor, but without D&B getting those loans will be much more difficult.
- You will require a business plan - but not just any plan will do either. What we advise our clients to do is get a "lender compliant business plan"
- You will also need your company's meeting minutes to be lender complaint.
- Plan out which banks you want to go to borrow the cash you will need to run your business - research.
There are companies like mine out there that can help you through the process and let me be the first to tell you, YOU DON'T HAVE TO PAY SOMEONE TO DO IT - you can do it yourself. When you have accomplished the above and need free advice we can help you through your application process. NEVER PAY SOMEONE MONEY UP FRONT TO HELP YOU WITH FUNDING!! There are brokers that charge money, usually on the back end and we advise that the highest you should pay should be no more then 10% of the loan amount.
Since our line of business is to form corporations, we let banks act as the broker for our clients and therefore we do not charge any fees and our funding process is always free. In fact we have a free hotline (1-800-270-5960) where people can call to ask questions.
In the meantime, the best advise is to visit
http://www.dnb.com/ and read about their products and services. You can also call their toll-free number at
800.234.3867 and speak to one of their representatives.
We wish you the best of luck!
