TABLE OF CONTENT
Now, getting back to the thought initiated above you would have the ability to make money and that your business would not flop
before the Open sign shows up on the door. But if this is not possible, if you need the cash before you can begin at all, then chances
are you will need to offer some type of collateral.
Collateral can be anything from your car to your home and everything in between. Depending on the
size of the loan, you may require some pretty hard assets for collateral. The lender is not interested in whether or not your business will make
money, aside from the extent that will allow you to pay them back on time. They simply don't want to lose out on the loan, and so you'll
have to find some way to back yourself up.
Backing up your loan with assets, if you have them, is a good route - provided you have
enough confidence in your financial situation to ensure you are not going to lose your collateral. If you don't have enough assets
to stand in for your loan, another option is to find a cosigner. Chances are you won't get as much cash as you would if you had the
assets. But having someone with good credit who is willing to sign onto your loan and promise to pay if you don't can be the factor
that gets you through the door. This is a good way for friends and family who believe in your business to help you get it off the ground,
even if they don't have the money to loan you up front.
When it's time to borrow, do some comparison-shopping among banks and credit
associations, and don't stop until you find the lowest interest rate possible. You're already gambling a lot here- minimize the
amount you will have to pay back by doing your homework and choosing the company that offers you the best deal. If you can't get
enough to cover your beginning business expenses, consider borrowing part of the cash from a friend or relative if you can, or even
asking for investors, such as customers who believe in your business, to help out. Don't accept a high-rate, high-risk business loan
just because it offers you the biggest amount.
The small business loan: The first step in a long chain of financial events. If you take the right step, it could be your leap into
the business world.
| 
