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3/27/2018

Funding Your Small Business

At some point, almost every small business finds itself needing some extra help to purchase new equipment or cover other critical expenses. When that happens, you’ll want to turn to a trusted lender who can provide that funding quickly, easily and professionally. Knowing where to start can be tough, and taking the leap into starting a relationship with a lender can be scary. Money is a sensitive and key part of business; it affects how we make many decisions and ultimately whether or not a business succeeds. Working with a good lender should bring you peace of mind, not anxiety. Lenders don’t expect you to be a financing expert, so they will help guide you in the process to funding your small business. First, however, you need to do some initial legwork to find the best lender for your needs.

Choosing the Right Lender

Any positive business relationship requires the two parties to trust one another, something that can be particularly challenging in the evolving technology landscape facing businesses today. With more business relationships taking place online instead of in person, it can be tough to build trust with the potential lenders you’re considering. It’s possible to combat this initial skepticism by researching the lenders you are looking at thoroughly. Seek out feedback from previous customers on sites like Trust Pilot, Yelp and Better Business Bureau (BBB). Look for a lender who has knowledge about your specific industry and has a proven, time-tested track record to ensure your loan is from an experienced source.   

Weighing the Options

Once you think you’ve found a lender that you’re comfortable working with, consider the products or services they offer and how each might serve your business’ needs. Think about how much financing you’ll need, whether you’re interested in a loan or a lease, the term lengths and rates offered, and the funding speed the lender promises. Many of today’s lenders offer funding that can be completed as quickly as the same day you are approved. CIT, for example, offers an online application process that takes as little as three minutes in most cases.  If you are leasing a piece of equipment or technology, you should also consider what your possibilities are at the end of the financing agreement, like a $1 buyout or fair market value option.

Understanding Your Agreement

Before making any commitments to a lender, you’ll want to make sure you understand what each figure in your contract means. Financial contracts are often filled with dense legalese and jargon, so keep lines of communication open with your finance partner to ensure you thoroughly comprehend what is being proposed. Take into consideration total payments, monthly payments and any additional costs like taxes or insurance. Instead of looking for the “best deal” as we are often drawn to do, look for a rate and monthly payment that works for you and your specific business needs. A good lender will be able to answer any questions you have about your finance agreement and will help guide you through all the preliminary steps.

Closing the Deal

After you’re confident that all your questions and concerns have been addressed and you feel comfortable in your chosen solution and lender, you’re ready to sign the deal. You’ll receive your funds, new equipment or technology soon thereafter and be on your way to running your small business.  

Being prepared when you are searching for financing for your small business will help reduce any stress you may have about the process. Seeking funding can seem intimidating at first, but can ultimately be a quick and stress-free experience with the right lender. With funding from a supportive and knowledgeable lender, you’ll be well on your way to meeting your goals and growing your small business.

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