Small Business Loans in Southern California

Be prepared to justify your income and expense projections; be able to show that the income is based on X number of units or services sold over a period of time for each month, i.e. you are open 300 hours a month and expect to sell an average of 20 units every hour with an average price of $10.00. What are the costs based on? Include details such as hours of opening, cost of raw materials, rate of pay?

If you are a new business, expect to show you have funds to contribute to the project and support your personal income needs.

Check your personal credit score, use an online service to be sure there are no surprises. Pay down revolving debt to 30% or below the maximum allowed to maximize our credit score presentation.

Have your accountant look over your internal bookkeeping to be sure it is correct.

Monitor your personal credit by paying bills on time, not having more than 3 inquiries in 6 months, and keeping credit card utilization at 30% or below. Lenders require a personal guaranty and your personal credit is important to be eligible for a loan.

Save money before your start your business so you can show you have capital to invest if needed. Lenders don’t like to take 100% of the risk, they want to know you have “skin in the game.” Carry a cash reserve so you can use your money to get more money.

Keep good records for your business transactions using an accounting software like QuickBooks so you can print a Balance Sheet and Income Statement when you need it. Also, understanding what happened earlier, can help you forecast for the future and prepare for it. If you foresee that you will need funds during the holiday season, you can start the process now and not when your funds are depleted.

If you are a startup, draft a business plan to include a description of the business, your experience & knowledge of the industry, a detail of the business capital needs, a marketing plan, and the financial projections. Some lenders require a business plan for young businesses as well.

File your taxes timely, most lenders will ask for 2 most recent tax returns (personal and business) and might reject your application if you have not filed them.