Having a business idea is the first step while planning for a business. However, resourcing of the business becomes a tag of war as many entrepreneurs would have to puzzle their minds on making clear decisions whether they should opt in for a loan or not. Today we are to guide whether you should opt in for a business loan or not.
Most businesses that operate today, 30 to 45% obtained businesses loans during the start and we can see now turned big ventures from small business ideas. Does this mean you should obtain a business loan? The answer is yes, business might need to seek for business loans while boosting their services not when they are starting up.
When we hear about sources of capital, we can mention many without forgetting the loans from friends, family, relatives and financial institution , of course these loans providers will not guide you sometimes because they are in business but we as Appnomu, we take business seriously.
Now if you are planning to get a business loan, make sure your business have stayed or existed for more than one year, this is so vital that you will already have the best statistics of your business performance, ROI(Return On Investment) and will give you a clear estimation of how much you should borrow and how you plan to repay the loan without affecting the business operations. The biggest mistake entrepreneurs face is opting in for business loans when they have not fetched the marker for their products and services. This is not true at all, why would you have more stock than the client’s consumption rate or purchasing behavior.
Businesses and entrepreneurs should not seek for business loans to start up the business, this will give the entrepreneur more factors that may negatively impact the performance of the business, the entrepreneur might be forced to over price items, over work to cover the loan expenses and at times, most of these kind of businesses do not survive in the long run.
So what should you consider while taking up the business loans that profits?
This post is not meant to discourage startup from accessing business loans, it is to help entrepreneurs decide whether they should take up loans or not, while taking up these loans, please consider the following;
- Interest: Most loan providers will allure you into big sums of money that sounds productive and you can decide to opt in for these offers. However, when taking up a business loan or any other kind of loans, consider the interest and repayment plans, if they are suitable, then you should consider taking up the loan. Appnomu gives loans with interest of 9% to 17% and gives good installments so you can keep track of your business performance than focusing on the loans each time.
- Loan term agreement; Most Entrepreneurs seek business loans and they fail to read and understand the loan term agreement. They end up failing the terms and conditions and as results, either lose their properties or security collaterals to creditors. Before you take up a business loan, you must read the loan terms and conditions so that you can realize if it suits both you or the other party only. We do not charge penalties for late loan repayment according to our terms and conditions. However, you should assume of the same from every provider.
- Security: Security in loans means item that you can allow the creditor to hold as an indication that you are able to repay loan on time. Money lenders and financial ins tuition will require securities more expensive than the loan taken. This might be land, cars or any productive. You should not assume you will be able to repay the loan and accept your allure to take up the loan when you are not aware of loan repayment. We provide loans without securities to individuals and to only registered- licensed business to operate.
With the above, we would like to hear from you of what you think. Your contribution helps millions of people to access business knowledge. Let us share and bring love together