So, you have finally decided to quit that 9-5 and start your own business, right?

Great!

If you have stumbled across this excerpt, it means you wish to find all the information you possibly can about getting a business loan.

We can understand that sometimes bank interrogations can be hectic!

They can ask all sorts of questions!

Questions that are not even in your domain of business.

This is not because they do not want to give you the loan, but they also have to protect the bank.

The business itself is a tricky business!

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For any person providing a loan for a business, they are not just placing a lot of trust on the person availing the loan but also on the concept and idea of the business.

This is one of the reasons why you need to be prepared.

Because they are going to drill you!

In this excerpt below, we will be bringing you some of the common and important questions you might have to answer when it comes to getting your business loan approved.

So prepare about these before you look through these business loan options.

Plus, we will probably give you the appropriate bonus answers which might help you.

Why Preparing For A Loan Is So Important

We have often heard people talking about preparing for loans like this massive responsibility.

Like they were going for a job interview or something.

Not that the bank doesn’t want to give loans; giving loans is like a big part of their business as well.

However, when it comes to approving loans, some banks are very strict about it.

They are strict about your income, finance, other debts, and collateral.

Anything!

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We repeat!

Literally, anything can get your approval rejected.

So, be careful.

– Do proper research about the bank and the kind of loans they provide.

– Research well about the interest rate and everything.

– Research well about the questions which could be asked.

Questions Bank Will Ask When You Need A Business Loan

Here are some of the common questions which have been often asked by people who have gone to get loans before.

Here are some of the answers which they have been able to provide to these questions.

1. What Are Your Collaterals?

Collaterals are a big part of any loan. However, necessarily a business loan has a huge sum of money.

Generally, more than any other loan, business loans have a high amount.

Thus, a concrete mortgage that will ensure the bank of full return of the amount, even if the business venture fails, is very important.

This is why you need to be clear about your collateral before you go for that ‘loan interview.’

2. What Is Your Business Plan?

When we talk about a business plan, it is not necessary that you have to lie to the loan provider.

Being authentic is enough.

They are not sitting there to judge you; they just want to know whether the business would succeed enough to get their loan paid back.

However, do not go there without at least a five-year plan chalked out.

3. What If Your Business Venture Fails?

This could be a tricky question.

You can either be super confident and talk about your previous successes with the business. Or, if it is a new business, you can always talk about plan B.

A different income source if this one fails.

4. What Is The Purpose Of This Business Loan?

If you are taking a business loan, then there has to be a purpose.

Yes, of course, your business is the purpose. However, you might have to be a little specific about it.

Like- Is it all for the business?

Or, Do you have funding, and you just need extra funding?

5. Can You Give Us Your Financial Details About Everything?

Yes, you have to submit your financial details about everything.

This necessarily doesn’t mean your personal expenditure details, but definitely your income from the business and what amount of it is spent on business expenditure.

Plus, what are your initial plans with the loan money?

6. What Are Your Past Track Records Of Credit?

This will definitely include any loans that you have availed of before.

Whether they are personal or bank loans!

This is a way for them to take off your character when it comes to financial responsibilities. They will take a look at your other credit records and see how efficient you are when it comes to paying back or paying bills on time.

7. Can You Show Us Your Business License & Permits?

This is an important part of every business loan.

Without checking the right full permits and ensuring that someone is not venturing into something illegal, they can never provide the loan.

8. Have You Done Business Before?

This is also another important question which you have to face.

This could be your second venture which you could be availing a loan for, or this could be your old business that just needs some extra funding.

Yes, these questions could be a little daunting since they will try to find a huge loss story or bankruptcy which will make you interested in this loan.

However, you just have to be confident that you will be able to repay the loan with interest at the right time.

9. Do You Have Full Ownership Of Your Business?

Give them full detail of all the ownership.

Hiding something would get you nowhere.

The right way of getting a loan approved is to be absolutely clear with your own business and give them all the details.

10. What Are Your Insurance Details?

Insurance is very important for business!

It is necessary that before you have the loan, you get the interest as well.

This is because your business idea gets more concrete when you have insurance. It shows you are prepared.

Get The Loan!

If you want to get that loan, you have to be careful about everything that your business holds.

If the loan provider finds that you yourself are unsure about certain things, this doesn’t give a good impression.

So, be prepared and get that loan!

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