5 key business borrowing questions
Getting the right business loan is more than just finding the lowest interest rate.
The right loan from the right lender can help a business grow and prosper. The opposite can also be true, which is why it makes sense to get the facts from potential lenders early in the borrowing process. Key questions for potential lenders include:
1. Do you lend to businesses like mine?
Although most banks say they lend to all businesses, some are more selective about the companies they pursue. If you are in an industry that a particular lender is reluctant to fund, you may waste significant time only to have your loan application rejected at the 11th hour.
2. How much business lending does your bank do?
It is good to ask how much business lending a bank actually does, and how many deals it has closed in the last six months.
3. Do you have experience lending to firms in my industry?
If you have a business with unique financial needs or circumstances, it pays to shop for a lender with experience funding firms like yours.
4. What is the lending experience of your personal banker?
The business credit experience of your personal banker is important in getting the guidance often needed to match the best loan and terms to your needs.
5. Is yours a local or out of town bank?
Local banks have deep experience in their marketplace, from executive management to the individual loan officer.