You’re running your small business and realize your cash flow is low. You calculate your current funds and apply to receive more. You filled out your application with precise and accurate information. It’s complete. You hit submit and anxiously wait for your approval. However, you got your funding denied. What can you do for your small business now? What steps should you take next?
Let’s face it, no one wants to be rejected for a small business loan. Unfortunately, it happens. Rather than sulk and question your business plans, try to be optimistic. Did you know many small businesses that are rejected in their initial application go on to obtain financing with later applications? Therefore, find out why you got your funding denied. Improve your application and be sure to choose the right product for your business. REIL is here to give you some steps you should follow if you were rejected for a small business loan.
Get an explanation
When you’ve received a denial, it’s hard to get a lender to change their mind right then and there. Fortunately, most lenders spent a lot of time with your file. They now know the ins and outs of your business after going over your application. Ask the lender to provide some explanations or insight on your file. Understanding why you’ve been denied is critical information that can help you succeed with your future application. The answer you are looking for may not be as obvious as you think.
Work on your credit scores
Your personal and business credit scores can have an impact on your access to business financing. Some lenders value it more than others. Nonetheless, it’s still important. Build your credit by making payments and repayments on time. Having no credit infers you haven’t purchased much, making it impossible for lenders any evidence regarding whether you have paid your debts back or not.
Improve your overall financial standing
Lenders look at every aspect of your bank statements. Annual revenue, cash flow, and business savings are some to name a few. Taking an objective look at your business’s statements from your lender’s point of view can help you immensely. It will help you determine how you can improve your financial standing and what areas are stronger/weaker than others.
Consider other lenders/products
A denial from one lender may be approved by another. Every lender has different variations and standards their company goes by. Here at REIL, we do our best to try and provide every one of our clients with the funding they are seeking. Explore your options with us through our products and quick and easy process. You may be pleasantly surprised!
