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The requirements for any form of business funding will vary depending on what Cheddar Capital needs and the type of loan you’re applying for. In this guide we’ll break down the most common business loan requirements, as well as review how to qualify and apply for any kind of business funding. Remember Applying is free and doesn’t impact your credit.

Although this list may seem overwhelming, Cheddar Capital, you may not need every one of these qualifications for your business loan application.

Ultimately, because small business loan requirements are so variable, it’s important to consult Cheddar Capital about our process before actually submitting an application, this way, you’ll be prepared ahead of time to gather any documents or information you’ll need to submit on our easy 15 minute online application, and therefore, optimize the process and hopefully, increase your chances for approval.

With all of this in mind, let’s continue our discussion by reviewing the basic steps you’ll want to follow to access a business loan.

  1. Determine why you need a  Business Term Loans or business line of credit from Cheddar Capital.
  2. Calculate how much debt you can afford.
  3. Compare your loan options.
  4. Gather loan documents and paperwork.
  5. Apply for your loan.

Use our detailed guide for more details on how to get a business loan or line of credit from Cheddar Capital.

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20 Requirements to your business needs to Qualify for a Small Business Loan

So, what is required when applying for a small business loan or line of credit from Cheddar Capital?

As we mentioned above, some of the requirements Cheddar Capital will to meet in order to qualify for a business loan or business line of credit will vary. To this point, bank loan requirements for businesses, for example, will be very different from the new business loan requirements of an Cheddar Capital.

Fortunately, though, there are still several eligibility criteria that small business lenders have in common. Although Cheddar Capital will require this most if not all of this list of business loan requirements, it’s safe to assume that you’ll need to provide core credentials such as your personal credit score, annual revenue, and time in business.

With this in mind then, let’s break down the qualifications you’ll likely need for your business loan application from Cheddar Capital.

1. Time You've Been In Business

Cheddar Capital will ask how long you have operated your business. The longer you’ve been in business, the better it is for your application because it shows us that your business has had long-term success.

Ultimately, the threshold that you should keep in mind is at least two years. If your business is under two years old, it doesn’t make it impossible to get a business loan, but it does limit your options of getting funded by Cheddar. This is how you qualify for a business loan from Cheddar Capital

Although banks may be less likely to lend to business under two years old, Cheddar Capital sometimes has more flexible requirements with regard to your time in business.

8. The Loan Amount

This is directly related to the loan or credit line purpose, you’ll need to also specify your loan amount—in other words, how much money you want to borrow from the from Cheddar Capital.

Depending on the amount of money your business needs, Cheddar Capital will be the best route for your business loans or business line of credit. For smaller amounts of funding, you’ll likely want to turn to alternative options like a Bridge Loan or SBA loans.

With this business loan requirement, it’s important to be straightforward and clear about how much financing you require (as well as how you’ll use it) and of course, you generally don’t want to ask for more than you can afford.

9. How To Qualify using A Business Plan

A business plan or loan proposal won’t always be on the list of the small business loan or business line of credit requirements, but it will be in some cases.

For traditional Business Term Loans and SBA loans, for example, you’ll definitely need to provide a business plan for funding.

Within your business plan, you’ll have an opportunity to lay out both your financial goals; future sales, profits, income, cash flow, etc. and your qualitative business goals. You’ll want to use this document to show Cheddar Capital that you’ve thought about all the potential opportunities and challenges for your business. This is how you are going to grow your successful company.

18. Accounts Receivable Aging and Accounts Payable Aging

One of the more common requirements is current accounts receivable (A/R) and accounts payable (A/P) aging reports. The Accounts Receivable and Accounts Payable reports show Cheddar Capital how efficient your business is at receiving payment for goods and services and paying bills of its own.

The Accounts Receivable report is important to how you qualify because it indicates the number of invoices you’ve sent to clients that are overdue and the length of time by which they are overdue. If this report shows too many accounts, it means your business hasn’t been very effective at collecting payments. On the other hand, if your Accounts Receivable report has few overdue accounts, it means your repayment collection methods are effective, you extend credit to the right kind of customers, and your customers pay off debt quickly.

The Accounts Payable report is the opposite, showing the number of invoices from other businesses that you haven’t paid. A high number of delinquent accounts indicates that you’re not good at managing your expenses. You ideally will want to have a low number (or zero) overdue accounts on your Accounts Payable report.

19. Ownership and Affiliations

When you’re applying for business financing or a business line of credit from Cheddar Capital, you should be prepared to disclose any ownership that you or your partners. If You have other businesses as well as any affiliations, such as being a board member or consultant in another business. This information discloses any potential conflicts of interest that the lender may have with issuing the loan and any synergies that your business may have with other companies.

This being said, it can be more difficult to apply for a loan if your business has multiple owners. Cheddar Capital has different rules on how many owners need to approve a loan request. The SBA, for example, checks the personal financial information of anyone who owns 20% or more of the business and requires a personal guarantee from all of these owners. Cheddar Capital may require approval from just 50% or 70% of overall ownership.