The post Business Loans: Standard Eligibility Requirements appeared first on The Atlantic Bridge.
]]>Fortunately, you now have countless options for funding your business. However, eligibility requirements vary significantly from one lender to another. Nevertheless, below are standard business loan requirements you need to prepare when you apply for a loan:
To be eligible for a business loan, most lenders require borrowers to be in business for one to two years. But if you’re taking out a business loan to fund a franchise you’ll need to give potential lenders relevant information about the franchise you’re looking to buy. You could find this information—the initial and operating costs of running the business—in your Franchise Disclosure Document, says an experienced franchise consultant from one of the franchise consulting firms in the area.
In general, lenders require that borrowers have a credit score of 650. If you’ve already started a business, you likewise need to submit your company’s credit report.
If you’re looking to take out a secured business loan, you need to have collateral, such as real estate, inventory, or equipment, that the lender could use should you default on your loan. If you don’t have anything to offer as collateral, you might need to opt for an unsecured business loan.
Lenders usually require that businesses have annual revenue of at least $50,000.
To make certain that you could repay your business loan, some lenders require that your overall income is around 1.25 times higher than the expected total expenses of your business.
You have to specify how you intend to use the loan because some lenders limit how borrowers spend their funds.
It’s difficult to determine which factor lenders deem most crucial when figuring out whether to give a business loan as each lender weighs criteria differently. Ultimately, you need to speak with different lenders, shop around for different loan products, and submit your application along with all the requirements to help increase your chances of securing funding for your business.
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]]>The Mortgage Investors Group and other lenders share some of the basic criteria for approving a loan:
This involves the evaluation of your income, making sure you have enough to cover a new loan payment and other expenses. Lenders figure this out through your debt-to-income (DTI) ratio, which shows a good balance between your income and debt. Lenders usually prefer borrowers with a DTI smaller than 36%.
The lender will look at your credit score, payment history, and other necessary indicators that you can make and keep up with the mortgage payments in the future. A good credit rating is a common requirement to increase your chances of getting approved.
A down payment of 20% or more is usually preferred. You can still get a loan with 20% down, but you are likely to pay private mortgage insurance (PMI). This can increase your monthly loan payment. You may also be required to have two or more loan payment reserves to be able to pay your mortgage in case of unexpected events.
The home’s value will help your lender determine if the loan-to-value ratio (LTV) suits within the guidelines of the mortgage. If you’re applying for a conventional loan, most lenders will require you to have an LTV of less than 80% to 95%. If you have a high LTV ratio, you may still be approved for a mortgage, but this is likely to cost you more.
Lenders use these basic criteria, so it is best to do everything you can to become an attractive borrower. It is also advisable to have an idea of how much loan or monthly payment you can afford comfortably.
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]]>The post Rid Yourself Of Bad Debt And Improve Your Finances With 3 Proven Strategies appeared first on The Atlantic Bridge.
]]>With the cost of living spiraling out of control, you need to put every dollar in your name to good use. If you are struggling to make ends meet, you need to take a hard look at your finances. You might be surprised to find that you’re throwing good money at some unworthy causes.
With most home loans accounting for up to a third on the monthly expenditure, you stand to save quite a bundle by refinancing at a lower rate. With the help a home loan calculator, you can search for the best deals in Utah. Bringing down your monthly payment by as much as half a percentage point results in considerable savings.
Not only do you have more money left at the end of each month but also get to lower the amount of interest payable over the life of the loan. In essence, it enables you to bring down the overall cost of your house.
While credit cards are handy and convenient, they also make great money sinkholes. Some cards carry exorbitant interest rates and can leave you to drown under a pile of debt. Rather than make the minimal payment on such cards, make an effort to eliminate such debts as quickly as possible. That might mean throwing every extra dollar you can to this cause.
While difficult to implement and execute, such a move saves you considerable sums of money in the end. In fact, you might channel some of the saving to paying off your mortgage.
If you are not in a position to pay off the high-interest loans quickly, consider moving them to a new card with a lower interest rate. In most cases, new cards come with ultra low promotional rates. However, you need to make a proper calculation of the total cost of the move and the interest rates after that.
With a little effort, you can streamline your finances and increase your savings every month. Refinancing your mortgage, transferring or paying off high-interest debts are some of the moves to set you on the right path.
The post Rid Yourself Of Bad Debt And Improve Your Finances With 3 Proven Strategies appeared first on The Atlantic Bridge.
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