Evaluate credit worthiness prior to applying for a business loan.
Small business owners must avoid depleting their current liquidity or cash position. They must immediately deal with negative financial issues including poor or inaccurate credit reports, and resolve all business and personal tax issues. A negative credit report and/or credit score can be a “deal buster”. Back taxes, liens, garnishments, multiple bounced checks all show increased risk for a lender. Borrowers should deal with recent bankruptcies by providing an explanation of why it occurred.
The above is quoted from EastSide Business Journal, where Jennifer Kilgus shared practical steps that will help us secure capital for our business. The above quoted is one of her tips that I deemed important for those small business owners opting for a small business loan.