5 tips on how to get a business loan in less than 24 hours
Are you a small business in need of urgent funding?
While we all try our best to plan ahead, at Lumi Finance, we understand that new business opportunities can often come out of nowhere. A sudden influx in orders requiring extra stock? Broken equipment that needs urgent repairs? An unexpected investment opportunity that will help your business grow?
All of these scenarios often require fast access to cash. So, what options do small businesses actually have to get the funding they need without compromising their cash flow?
Here are some business funding options to consider:
Option #1: Tap into your family network
Depending on the amount needed, it can be a good idea to explore your own family network first. The clear advantages with this option are that you will most likely get the money in the bank super fast without having to go through any of the formal application process, settlement, transfer of funds etc.
Option #2: Explore private funding
If you have private investors involved in your company that can help you with a loan, that could be another valid option. This could allow you to negotiate more flexible terms and conditions, including the repayment terms and timeline to best suit your business’s individual needs. With private investors you would likely still need to present your business case to show how their investment would help the business grow and any forecasts on what their returns would be.
Option #3: Consider a business loan
If option #1 and #2 are not available to you for whatever reason, you can also consider getting business funding from a third party lender. Depending on the lender, business loans can often nowadays be assessed within hours. Meaning that the money could be in your bank account on the same or the next business day.
To set you up for success, here are 5 tips on how to get a business loan in less than 24 hours:
1. Pick the right lender for your business
Do some research on what lender would be best placed to provide funding quickly. Alternative lenders like Lumi Finance are often best equipped to provide quick access to funds for growing businesses.
When looking at lenders, consider other important criteria such as loan offering, including terms and interest rates, application and approval process etc.. Don’t forget to check out some customer feedback as well. This can give you great insights into the lender’s processes and general client service standards.
Some lenders offer funding to specific industries or bespoke loan products for certain industries. Finding a lender that not only suits your needs but also understands them could make the application process and access to funds much easier. Choosing the right lender could even help to reduce the risk of getting your loan application declined.
Don’t hold back from calling their sales teams to ask them any questions you might have about their loan products, processes and application requirements. Often lenders have specific minimum requirements that you need to fulfil to be eligible for a business loan with them.
At Lumi Finance, our minimum requirements are as follows:
- Minimum 6 months in business
- Minimum $5K monthly turnover
- Active ABN/ACN
2. Prepare your business documents
Before you start your business loan application, prepare all the required documents. Check what the lender you’ve chosen needs in order to assess your application, so that you’re not missing any crucial components. This could otherwise delay the application process and therefore the access to funds.
Most lenders will require financial documents or access to your bank data, a business plan and forecast. If you haven’t done this before, the Australian Government offers great free resources to help you put a business plan together.
A bad credit history can impact your ability to borrow money, so it’s also important to check your credit score. You can access your credit report via any of the official credit bureaus such as Equifax or Experian. Note that accessing your credit report will not affect your credit score.
3. Choose a realistic loan amount
Once you have your financial and business documents in place, you will also have a better idea of not only how much money you wish to borrow but also how much money your business can potentially afford to borrow. A lender will only lend you money that they know you can afford to pay back.
If you need help calculating your affordability, check out Lumi Finance’s business loan calculator. You can put in your ideal weekly repayment amount, the repayment period and preferred interest rate and the calculator will provide you with an estimate of how much you could borrow.
Note that these numbers are only designed as an indication to help you apply for a realistic loan amount. There is no guarantee that your business loan application will be approved at this stage of the process.
4. Provide all the necessary information
Time to apply for that business loan. Depending on the lender you’ve chosen, you can often apply online. At Lumi Finance, our application process is straightforward, especially if you have done the preparation work. It will take about 5 minutes to complete. If you provide all the required documents and information then you can usually expect an outcome within a few hours.
This process and timeline can greatly vary from lender to lender. That’s why it’s important to choose the right one for your business.
5. Respond quickly to any additional questions
Our last tip on how to get a business loan in less than 24 hours is to make yourself available for any additional questions the lender might have about your application and business in general.
So, even if you have supplied all the required documents during the application, there might be specific incidents where the lender will need some additional information.
Knowing that you might receive a call or email from the lender and making sure to respond quickly can help them to process your application faster and therefore pay out your funds quicker too.
