Entrepreneur loans, everything you need to know
One of the aspects that most often worries when starting a business is the economic factor. That is why loans for entrepreneurs tend to be among the most demanded by financial institutions, which pay special attention to this profile of users.
Entrepreneur loans, why apply for them?
Starting a business is not an easy task, nor should it be a decision made lightly if you want to be successful. Behind this decision there are usually many hours of reflection, of creating business plans and, usually, many calculations to see if there is enough capital to start the business. If you don’t have enough money, entrepreneurial loans are a good way to get financing and start your business with some financial peace of mind.
Most new businesses need financial support that is often difficult to obtain. However, entrepreneurial activity in the country has been growing for a few years. This is clear from the the country report made in 2018. The rate of entrepreneurship in our country has increased one point compared to the previous year, from 5.2% to 6.2%. This means that, for the first time in eight years, it has risen above 6% and has begun to reach the figures reached before the crisis.
What requirements must be met with new business loans from banks?
Taking out new business loans from traditional banks may not be an easy task. And is that the requirements to be met by the applicant are not few. To the usual requirements of banks, there are others directly related to the activity of the new business. The most common and that will not be overlooked are the following:
- Do not appear in any defaulters file. If you are on the debtors list, you will automatically be discarded as a candidate for entrepreneurial loans.
- Your level of indebtedness. It is normally calculated that the applicant’s level of indebtedness does not exceed 40% of his monthly income. This means that you will also have to justify what your monthly income is and where it comes from.
- Your previous relationship with the bank. If you are a regular customer and they already know you, they may make things easier for you. Of course, they will check each and every one of the loans you have with them and with any other bank, whether personal or business loans. In this way they will establish the aforementioned level of indebtedness.
- Extra guarantees. Depending on the risk that the bank detects in the operation, it is most likely that they will also end up requesting some type of personal guarantee.
- Business plan. If you are looking for financing for entrepreneurs, many entities will ask you to present this documentation. It is a way of knowing the project for which the loan is requested, the business model and its viability.
Loans for entrepreneurs without collateral
One of the concerns that entrepreneurs have when requesting financing is the fact that they are asked for a guarantee to get the amount of money they need. It is not easy to find someone, whether with family or friends, who is willing to endorse a new business. Either because you are not sure that the company is viable or simply because you do not have the economic capacity to do so.
One of the options to get a loan for entrepreneurs without collateral are home equity loans like those offered by Suitaprest. If you have a property or premises in property that does not have pending charges, this will work as a guarantee to access the amount of money necessary to start the business.
Private equity companies are a very good option to get loans for entrepreneurs because the granting requirements are much more flexible.