Hey, it's Ty Crandall with Credit Suite in this video, I'm going to show you
exactly what it takes to get approved for a business
or credit line for your business. By the end of this video,
you're going to know exactly how to get approved, even if your
bank has said no in the past. As a matter of fact, you're probably even going to
learn why your bank said no in the past.
So when it comes to getting business loans, there's three main criteria that lenders
are looking at to determine if you should be approved. I call this
the three C's approval formula and it
really comes down to this. The first C is Credit,
they're going to look at your quality of your personal credit. If you
have good personal credit or a guarantor like a family member,
friend or potential investor that has good credit. That opens up
an unlocks a lot of different funding options for you.
How many inquiries you have, your utilization, as well
as your FICO score, will all determine if you can get
this kind of credit-based financing. Now, the
second C is Cash flow, if your business has consistent cash
flow and if you've been around and open for six months or more and
that cash flows five thousand a month or higher than that opens up
and unlocks all kinds of funding options that are
for available for you based on your actual
cash flow of your business. Now, what lenders are looking
for is that you manage your cash flow responsibly.
They want to make sure that you don't have a bunch of overdrafts every
month, that you have positive ending bank balances at the
end of each month. They want to make sure that you have
plenty of money left over month to month to be able
to pay the bill
on the actual loan or credit line. They're going to give you.
So responsible Bank account management is a
must when it comes to cash flow financing. Now the
third C is Collateral and there's all kinds of
assets that you can use to qualify for very low-
interest rate credit line or credit lines
or loans that are collateral-based. So
collateral-based financing looks at all kinds of things like maybe
you're an insurance agency and you have a book of business. Maybe you want to buy
or already have commercial vehicles or
commercial real estate you can use as collateral 401k,
stocks, IRA, bonds.
Equipment can be used as collateral, inventory can be used as
collateral. And these type of things like equipment inventory, you can be
able to get specified financing to buy them
or you can borrow against them if you own those
assets free and clear. So the question becomes what
assets do you own? For example, you can get
financing using your purchase orders as collateral or using your
account receivables where you're allowing your customers to pay you
on terms and then use those account receivables as
collateral to be able to get financing. Now, the great
thing about asset-based financing is you don't need to have good credit to
get approved, you don't need to have cash flow either. All you
need is the asset applied as collateral. And the other good
news is you can typically get interest rates of 5 percent or low
that are lower. Now when it comes to cash flow based financing,
you don't need to have good credit, you don't need
collateral to get approved. And that's very fast financing, as a
matter of fact, with cash flow based financing, if cash flow is your strength,
you're able to typically get approved and get funding in 72
hours or less. And back to the very
first C, we talked about credit-based financing. If you have good
credit, you don't need cash flow. You don't need collateral to get
approved. That means even as a high-risk industry or even as a startup,
you're still able to get up to one hundred and fifty thousand
dollars in credit lines. The three C's formula is
easy Cash flow, Credit, Collateral. If you have one,
it unlocks those funding options for you. In the more of the C's you have, the
better kind of financing you can get. So for example, if you have consistent
cash flow and good credit, then you can get
longer-term, term loans. You can get lines of credit as
well if you have all three C's cash flow credit and
and collateral, that's what unlocks SBA loans. So the
key to getting financing for your business is cash flow, credit and
collateral. The more of those you have, the more
money you can get for your business. But what
happens if you have none of the C's? That's when
business credit becomes crucial. Business credit helps you
become more fundable, the nice thing about building business credit
is that you're able to get very high limit credit cards along the
way. You're able to get 10 thousand, 20, 30, 40, even
50 thousand dollar individual limit credit cards at
places that you do business with all the time. From Sam's
Club and Costco to Amazon and Walmart to Staples, Office Depot,
Home Depot, Lowe's, almost every major retailer
offers this kind of corporate credit. You can get it without a personal
guarantee. You can get it without a personal credit check. You can get it
with no collateral check, no cash flow check. So you can get
it even when you don't have one of the other C's
that makes you lendable. So there you go. That's a
formula to get a loan for your business is either cash flow, credit or
collateral. If you have none of those, then you want to build business credit
instead to get high limit accounts and to make yourself more fundable
if you do have cash flow, credit or collateral. You still
want to build your business credit because you're business credit one of over
a hundred and twenty-five fundability factors that will
determine how much money you can get for your business and the rates and terms that
you'll pay. So to learn more about getting approved for credit, for your
business, financing for your business and building
your fundability. Visit us online at creditsuite.com.