Unsecured Business Lines of Credit: Now its your turn to ask the questions

Whether you’re at the planning stages, or more seasoned in your business, you may be intimidated at the process of obtaining working capital. Maybe your mind is boggled down with all types of questions about what “they”-the big bad financial institutions- may need to see from you, know about you, know about your business, etc. While you should know the eligibility requirements before you apply for any type of funding, don’t be intimidated. You have some power in this too. Not only are they making a decision about you, but you’re deciding too. That means there are questions you should ask first before even submitting an application.

For the purpose of this article, we’ll focus on what to ask before applying for unsecured business lines of credit. Here are 3 key questions to consider:

1.) What makes you the expert? This is a simple way of saying what can you help me with that I can’t do on my own. Many companies can do more harm to your credit than anything, which of course, will affect all business dealings in the future. Anyone can fill out some applications, send them out blindly, and sit on their hands waiting for a response. What you want is an expert with professional networks, know-how, and a history of creating positive results without negatively affecting their clients’ credit.

2.) What are the benefits of working with your firm? As you can see, there are many firms offering to help you obtain funds. So what makes one company stand apart from another? Well it depends on your needs and preferences. For instance, if your credit is in need of restoration, then choosing a company that can help you in that way, as well, may be beneficial to you.

3.) What are the upfront fees? Notice, we didn’t say “Are there any fees?” The truth is, some firms charge upfront “fees” for different reasons, but be careful. Exceptions are, typically, application and consulting fees, which many firms legally and ethically charge. However, in most cases, it is better to go with a firm that receives the majority of their revenue from approved loans. This shows confidence, experience, and is no risk to you.

Of course, once you do your research and settle on a company to apply through, you can ask some follow-up questions. Questions, such as, how much money you’ll be able to borrow, what the interest rates are, and what is the approval time, can depend on your credit score, years in business, etc. However, these questions should be answered transparently, and to the best of the firm’s ability.

Found your company? Okay, great! Now take a deep breath, and prepare to answer some questions. But promise yourself that you will not be so intimidated by the process that you forget to ask your questions too. Whether it is short-term or long-term, you are starting a relationship. Therefore, you need to know what your “partner” is bringing to the table. So ask!