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Sunday 15 February 2015

Shared Business Loans – An Alternative option to get loans

The need to apply for a bank loan is usually the result of a loss a business is experiencing, replacement or planned investments in new machinery, construction or renovation of a building or the finance of business growth. This growth resulting in, for instance, an increase in accounts receivable that need to be financed by a third party. Normally the reason, your business is running with a loss, is the most difficult one to get your loan rewarded by a bank. They must be convinced the loss is only temporary and the risk for the bank, in case of a collapse, is minimal.
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Business Loans
What to Do if not convincing?
If Banks are not convincing to you then the second option is Shared Business Loans. Shared business loans are the loans in which you can share your loan with the others or you can get the help from other business owners to approve your loan. In this type of business loans you can get the help of your friends or relatives’s business by putting them as a guarantor of loans.

In the shared business loan process the Guarantor signed an agreement with the bank that if the recipient is not eligible to pay his monthly installment then he/she will pay for it. In this process generally the guarantor had been  the already existing member or customer of the bank. The Guarantor can  help by extending  his business loan amount and share with other. In this process both the applicant or guarantor need to put all the documents  of his/her business. Then the bank deeply examines all the documents and if you fulfil to all the eligibility criterion you get your loan approved.

Documents required to apply for a Business Loan:-
Before you speak to your account manager or loan manager at the bank, it is advisable to have a balance and profit and loss statement from a recent date to your expose. Preferably you will be able to present a balance that shows the situation after the point of investment. And a profit and loss projection for next year and years to come.

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