3 Positive Qualities to Look for in a Small Business Lender

There are many reasons for which established entrepreneurs seek out small business loans. In some cases, these loans can help facilitate the move to a bigger workspace or assist in making improvements to an existing one. Alternatively, some small business owners put these loans toward purchasing new equipment or hiring individuals with specialized skill sets. Regardless of your reason for obtaining a small business loans, there are several important qualities you should look for in a lender. To ensure that you wind up with a reliable, trustworthy lender, be on the lookout for the following traits.

1. No Restrictions

When perusing business lenders, it may be in your best interest to look for one that doesn’t place cumbersome restrictions on what their loans can be spent on. While these restrictions make sense in theory, they often prevent small business owners from making the most of their loans, ultimately rendering the borrowing process useless. In the interest of spending your loan in the manner you see fit, keep an eye out for lenders that won’t saddle you with restrictions.

2. Fast Response Times

When most small business owners apply for loans, they hope to hear back from prospective lenders as quickly as possible. Unfortunately, many lenders have absolutely no qualms about keeping borrowers in suspense in for weeks. If you don’t feel like sitting on pins and needles while a lender reviews your loan application at a snail’s pace, limit your choices to lenders that get back to applicants within one to three business days.

3. Convenient Repayment Options

A good lender understands that many small businesses struggle financially throughout their first year and will provide borrowers with a convenient assortment of repayment options. If you’re not crazy about the idea of paying the entire loan back in a single lump sum, look for lenders that offer daily ACH options or are willing to deduct a small percentage from daily sales until the loan is paid back in full.

Owning and operating a small business can be an uphill battle, especially during your first year. Fortunately, a generous loan from a reliable lender can help keep your ship afloat until you’re able to get out of the red. Small business owners looking to make the borrowing process as hassle-free as possible would be wise to seek out lenders who don’t place bothersome restrictions on what the money can be used for, respond to loan applications in a timely manner and offers borrowers a convenient array repayment options.