If you need to get more money for your businessgoing to the bank and spending hours to process the application can be a real waste of time – especially considering their strict approach, and the many documents required.
To ensure a smooth and hassle-free process, National Business Capital has designed a state-of-the-art online system that allows you to apply in minutes and receive dozens of offers quickly.
So, if you're looking to apply for a working capital loan online, here are some of the quick and easy steps you'll need to take to secure it:
Step 1: Find a Reliable Lender
Finding financing online can be difficult, as you may end up applying with an unreliable or inexperienced lender.
If that happens, you could end up paying above-market interest rates, hidden fees, or suffering from unfair loan terms such as very short repayment periods or large early payment penalties. Extreme cases can lead to data theft, loan scams, and identity fraud.
All of that can have a negative impact on your credit score too – if the loan is structured incorrectly or on the wrong terms, you may have difficulty paying, which can lead to defaults and bad credit.
Therefore, if you want to secure a working capital loan online, make sure you apply at a reputable financial institution, such as Specialty Finance Group. National Business Capital.
Our highly skilled and experienced team is secure $2 billion in financing business owners across over 27,000 transactions, and we are a proven market leader in financing $100K – $5M+ transactions.
When choosing an online financial institution, always pay attention to reviews, customer testimonials, and information, to ensure that you avoid exploitative business loans.
Step 2: Plan Your Active Loan Usage
Planning is essential if you want to secure an online payday loan and maximize its benefits for your business.
Having a clear idea of how you plan to use a business loan, and what terms and rates are comfortable for you will help you make a better decision when applying, especially when comparing different offers.
A working loan can be used for a variety of day-to-day business activities, including:
- Purchasing inventory or raw materials
- Paying short-term debt or existing debts
- Handling unexpected expenses
- Paying operating expenses, such as rent and payroll
- Managing cash flow gaps
- Financing short-term projects
- To meet seasonal demand fluctuations
- Improving or repairing equipment
- Covering tax obligations
- Having a financial cushion during slow times
However, keep in mind that working capital loans are very convenient temporary business needs – if you are looking for additional funds to meet long-term needs, you may benefit greatly from a business term loan or business line of credit.
Step 3: Prepare Your Documents
The next step in the process when it comes to applying for a payday loan online is to prepare your documents. As we mentioned earlier, banks tend to require more documentation compared to online lenders, so keep that in mind before applying.
Preparing all the documents will not only save you time during the application process, but it will also get you a response from the financial institution faster.
You may need to show more or less documents depending on the borrower, but in general, we look for the following:
- Business Information – Including the legal registration of your business, your EIN, a complete business plan (especially if you are not yet an established business), and an article of incorporation (if applicable).
- Financial Statements – When you apply for a working capital loan online, lenders will want to look at your balance sheet, your profit and loss statement, your cash flow statement, and your bank statements. Additionally, be prepared to show your tax returns for the past 1-3 years, as well as Accounts Receivable and Accounts Payable aging reports.
- Business Credit Information – If you have an outstanding loan, this information will need to be extended to the lender, including payment plans. This will help calculate your Debt-to-Income Ratio, and determine if you qualify for a loan. Provide a list of all your current business loans, including rates, amounts, and terms.
- Legal Documents – In addition, you may need to provide legal documents, including lease agreements, franchise agreements, and contracts with suppliers or customers that can guarantee future income.
- Collateral Documents – When you apply for a secured working capital loan online, be prepared to show a valuation report of the collateral you plan to provide – such as property or equipment. Make sure it's the latter, otherwise the expected income from the sale will expire. You will also need to provide proof of ownership of any collateral, such as deeds or ownership documents.
Although many financial institutions will check your credit score, it is always recommended that you get a business credit report from one of the major credit bureaus, Experian, Equifax, or TransUnion.
Step 4: Check Your Creditworthiness
Although this step is not mandatory, and you can continue to apply for a working capital loan online without it, we strongly recommend that you do a credit check before you start the application process.
This will give you a clear idea of what to expect when you apply, whether you are likely to be approved or rejected, and what terms and conditions you may end up receiving.
To assess the suitability of your business:
- Check your business credit score and the institutions listed above. If you have bad credit, you can still get a working capital loan online, but it can be challenging unless you apply through another financial institution like National Business Capital.
- Analyze your financial statements determining your financial stability. Review your balance sheet, check if you have a good debt-to-equity ratio, and if you have too many assets or liabilities. Checking your income statement and your cash flow statements will also be important.
- Calculate important financial ratiossuch as Debt-to-Equity Ratio and your Current Ratio. These financial metrics will help you determine whether your business is heavily reliant on debt, which is important to lenders. You will need to ensure that you can pay your short-term debts to a certain extent.
- Measure your credit scoresand compare them to your income and cash flow. High credit-to-income ratios can have a negative impact on your creditworthiness, which isn't good if you're looking to get a working capital loan online.
- Check your business credit utilizationand review it from the lender's perspective to see if they will see responsible credit management on your part. It is important to ensure that your credit utilization ratio is correct less than 30% – you can calculate by dividing the amount of credit used by the total amount of credit available.
Step 5: Start the Application Process
Now that you've prepared all the documents, determined your eligibility for a loan, and selected a reputable lender, it's time to begin the application process.
The time it takes to apply for a working capital loan online, and get a response from a financial institution, can vary greatly – for example, banks often which is boring and it can take weeks and months to review and approve your application.
However, non-bank lenders like Specialty Finance Group National Business Capital has a quick and streamlined application process. With NBC, you can securely apply within minutes, review dozens of special offers, and receive your funds as quickly as 24 hours!
Qualify for a Working Capital Loan through NBC
If you want to qualify for a work capital loan, look no further National Business Capital. With $2+ billion in funding since 2007, multiple awards, and an experienced team of Corporate Finance Advisors, we have everything you need to find the best financing options for your project.
Are you ready to get started? Apply here.
