SharpShooter Funding Business Loan
Borrow up to $500,000
- Borrow from $500
- Free online loan quote
- Quick application process
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Unlike your typical personal loan, business loans involve more risk for a lender, resulting in stricter eligibility requirements and longer applications. You’ll typically need to gather a range of important documents and financial details in order to complete the loan application.
Read our business loan requirements guide below to learn what to expect when applying for a business loan, including typical eligibility and documentation needs.
The good news is that business owners today have many more options when it comes to finding funding than they did years ago. But you’ll find that business loan requirements can differ widely among lenders.
While these will vary depending on the lender, here are some common eligibility requirements you’ll find when applying for a business loan.
It’s hard to say which factor is the most important when it comes to your business loan, with each lender weighing criteria differently. For one lender, it could be your business’s minimum annual revenue that decides the success of your application, while another lender could look more closely at how long you’ve been in business, your personal credit score or the collateral you’re able to offer up.
In the end, it’s best to research the specific lender you’re interested in and ask exactly what they’re looking for when it comes to approval. Otherwise, your application could be rejected.
If you’re starting a business venture or you want to take your business to the next level, you’ll need financing to help you out. Here’s a look at some of the most common lenders you can rely on to provide you with a business loan.
Many larger financial institutions, like banks, will require you to make an appointment to complete an application in person. However, newer online lenders automate the process with the convenience of a completely online application.
To initially complete your application, you’ll typically submit:
SharpShooter Funding offers loans up to $500,000 for small business owners who have been business for at least 6 months and can show a minimum of $10,000 in monthly deposits.
After applying for a business loan, a representative will likely call you to go over your application. To confirm the information you’ve provided in your initial application, you’re often required to upload further documentation of your business’s financial details.
Whether you’re applying for a business loan via an online lender or a traditional lender like a bank, here’s what you may need to provide:
If your lender provides the option to upload information online, you can protect the integrity of your documentation by submitting it as a PDF. You may also be required to fax copies of important documents or scanned ID’s before a lender will approve your application.
Although a business plan may seem like a lengthy document, if you break it up into sections and focus on one at a time, you’re well on your way to a convincing position. Use our checklist to make sure you’ve ticked all the important boxes of what an excellent business plan is.
Knowing exactly why your business needs financing is key to deciding what type of loan you need, which lender to go with and how much it’s going to cost you.
Do the math and add up your expenses. This will help you narrow down lenders: Most have minimum and maximum borrowing amounts. It’s generally not a good idea to borrow more than your business needs because you’ll end up paying more in interest.
Before you apply, check your personal and business credit reports for errors. If you notice anything wrong, contact the financial institution and the credit bureaus to have it changed. Doing this before you apply can not only up your chances of being accepted, but it can also help you qualify for more favourable rates and terms.
Pay just as much attention to lender’s eligibility requirements as rates and fees. While some lenders are flexible with eligibility, you’re more likely to be approved if you are solidly over or under any cutoffs. Rule out any loans that you don’t think you’ll qualify for. If you’re not sure whether you’re eligible or not, contact customer service — most are happy to discuss eligibility requirements when it comes to specific situations.
Before you even apply, gather together any documents your lender requests. It doesn’t hurt to anticipate any further requests by having extra documentation on hand. If you’re applying online, scan your essential documents beforehand to make the application process as quick and easy as possible.
Follow your lender’s application instructions and reach out to customer service if you have any questions. Many lenders have a live chat option on their websites and almost all have a customer service line you can call. Before you submit your application, review it a few times to make sure all the information is accurate. One of the top reasons lenders reject applications is because it contained incorrect information.
While you don’t need collateral to get approved for a business loan, securing your business loan with assets like equipment or real estate can increase your chances of approval and even score you a lower interest rate. You’ll have to apply with a lender that offers secured business loans of course.
|Request a copy of your personal and business credit reports from Equifax, TransUnion and Dun & Bradstreet.|
|The older, the better. Lenders often require you to have been in business for at least a year or two.|
|Your industry could affect the type of loan you qualify for. Some lenders have restrictions for lending to business in industries such as gambling or cannabis.|
|Ask for only as much as you think you’ll need based on your assessment as well as past business needs.|
|Be ready to discuss with your lender how you’ll use your funding.|
|Lenders often require a minimum annual revenue of $80,000. If you’ve been in business for less than a year and are applying for a startup loan, minimum monthly revenue requirements typically start around $7,000. Lenders may also set maximum annual revenue requirements. The Canada Small Business Financing Program (CSBFP), for example, has a maximum annual revenue cap of $10 million.|
|Lenders typically like to see at least two years of your business’s bank statements. If you are a young company, provide as much information as you can to support your application.|
|Prepare a year-to-date revenue statement that documents your company’s net sales, cost of goods and administrative expenses.|
|Balance sheets provide a picture of your business’s overall assets, liabilities and shareholders’ equity.|
|Lenders will want to confirm your income and revenue reported to the CRA —on both your business’s and your personal returns.|
|A solid business plan boosts your credibility and helps convince lenders that you’re worth their investment and that you’re serious about creating a successful business.|
|Reference free templates online to assemble a comprehensive account of your business’s outstanding loans and other debts.|
|Lenders will want to know your projections for expected revenue in the coming months.|
|Be ready to document inventory, real estate or equipment that you intend to offer as collateral if applying for a secured business loan.|
|You may be required to submit documentation of your employee and payroll records when applying for your business loan.|
Qualifying for one of these loans comes with an involved qualification process and strict eligibility criteria. Since you can’t use these loans to finance certain types of businesses, you’ll need to prove that your business meets the requirements. You’ll also need to use the funds for specific purposes – so be sure this type of funding makes sense for your business.
You can learn more about the Canada Small Business Financing Program (CSBFP) here.
Depending on the size of your business and desired loan, you may qualify for more than one type of financing from a variety of lenders. Keep in mind that traditional banks often have stricter business loan requirements and application processes. You could find that online lenders are a better option for your financial needs, especially since they usually offer comparable – or better – interest rates and fees, less strict eligibility criteria and an easier application process.
Before applying for a loan, explore your financing options and the business loan requirements of various lenders to find a business loan that best fits your situation and helps you remain profitable and successful in the years to come.
Find out how you can get approved for a loan even after filing for a consumer proposal.
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If traditional lenders aren’t an option, Easy Financial helps you with unsecured loans of up to $15,000.
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If you’re willing to use your home as collateral, Easy Financial provides secured loans of up to $45,000.
Need access to cash? Cash Money lines of credit offer flexibility to borrow as much or as little as you need, up to a maximum of $10,000.
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