Tips On Getting Lower Small Business Loan Rates

2007-03-08 10:33:40

( Business )



Whether a small business has been around for some time, or is about to start up, it may need financing for its working capital requirements. One source of small business loans can be your bank. Banks generally provide a credit line with variable rates. These variable small business loan rates usually change depending on the movement of the index that they are tied to. Some banks may have caps that can never be raised within a certain period for this type of small business loan rates.

There are also some business characteristics that can affect the bank's decision of whether to grant you lower or higher small business loan rates. If you are applying for small business start up loans, it may help if you can get referrals from entities that do business with, and have good credibility in the bank. You may also enjoy lower small business loan rates if you bring significant other businesses, such as availing their cash management services and credit card merchant services.

If you take out a loan after years of running the business, and it has developed a good credit standing or has done well during that period, the bank would be willing to give favorable small business loan rates. It would also put you in a better negotiating position if the bank is aware that other banks are interested to offer you reasonable small business loan rates.

Small business lenders are not limited to banks. You may obtain small business loans from a federal agency that offers lower small business loan rates. A conduit bank will provide the money, but the interest rates are lower than regular loans because the federal government guarantees the credit. Or, you may also want to check the local credit union in your area. Credit unions often provide lower small business loan rates to their members.


All rights Reserved © Tradenet Services srl
Do not duplicate or redistribute in any form.