If you’re looking to grow your business and take it to the next level in 3-5 years, you’ll need to be thinking about employing capable talent, buying inventory and advertising to potential customers. Each of these activities requires a significant amount of time and capital, and can even become an ongoing cost that needs to be accounted for each year. For example, marketing can become quite expensive, as you’ll need to be identifying and nurturing new customers for your business every month to keep sales high.

What business owners should know before applying for a business loan

Although every application is different, there are some common things that lenders tend to look for. This means that you can significantly increase your chances of securing finance by educating yourself on the things that factor into the lender’s thought process and algorithm.

By being proactive, you increase your chances of having access to a wide range of funding options. The more choice you have, the more empowered you’ll be to pick the loan that works for you (rather than the loan that works for the bank).

There’s no silver bullet that can guarantee loan application success , but we’ve broken down the lending algorithm trends into three key components:

1. Your business’ credit profile;
2. Your loan and repayment schedule; and
3. Providing security for the loan.

These components are premised on which institutions you can seek finance from, so let’s quickly run through what the lending landscape looks like today.