Many business owners dream of having extra capital to buy equipment, inventory, increase payroll or to fund that brilliant new idea that popped into their head while brainstorming at their recent EO meeting.
The Most Important Question
Unfortunately, many business owners often over look asking the most important question when seeking working capital until after much time and energy have been spent researching lenders, completing forms and submitting applications The question is whether the business can afford the monthly payment.
Yes, the first step to determining whether applying for an SBA working capital loan is the right choice for your business is to calculate the monthly payment.
Working Capital Loan Calculator
Fortunately, we have developed a simple to use online working capital calculator that will help you and the decision makers within your business determine how much to apply for and the monthly payment. Before you use the calculator there are also a few other items to discuss.
When To Apply For an SBA Working Capital Loan
Applying for an SBA working capital loan should not be entered into lightly. For one thing it will take a considerable amount of your time and resources. Second, there are two tests that must be passed prior to applying. The First test is eligibility and the second is qualification.
Contact us to help you determine your businesses eligibility.
Next, you must decide whether you are able to fund your growth plans with existing working capital already available to the business or to seek debt from external funding source.
There are several factors to consider when making this decision. I have listed five below.
- Can my business afford to repay the loan with existing cash flow?
- Will the working capital generate more revenue and profitability?
- How long do will it take to repay the loan in full?
- How long before the business begins to realize profit from the loan?
- Am I bridging a cash shortfall due to a fundamental flaw in the business?
If you answered yes to question number five then you definitely need to stop and consider other options besides a loan to save your business. Too many business owners obtain working capital to save their business instead of grow their business and this is a recipe for disaster.
You’re Ready To Apply
If you answered the questions above the right way and are ready to apply for an SBA working capital loan we’re here to help. Remember, the first order of business is to calculate your monthly loan payment.