With many lenders, the more you’re looking to borrow, the more hoops you have to jump through. When such vast sums of money are being transferred, it’s crucial for all parties to ensure that loans are being borrowed responsibly, without jeopardising the financial security of the borrower or the loan provider in the future.
Loan eligibility requirements are conditions that a prospective borrower is required to meet (by the lender) in order for their loan application to be considered for approval. A common example of this is for borrowers to provide bank statements and information on the business’ turnaround and profit.
Should a borrower seek to apply for a larger loan amount, then lenders may set additional eligibility requirements. For instance, the lender may ask for an asset to be provided as a form of security. This can range from a vehicle or a piece of equipment to commercial or personal property. This is in case the borrower is unable to repay their business loan, therefore the lender is able to sell the assets in order to cover the loss of their funds.
There are a number of ways you can improve your business’ desirability to lenders.
To begin with, be realistic about the loan you’re applying for. For help with this you should use the lender’s business loan calculator (or equivalent) to gain an approximate idea into how much you’ll be paying back each month. This is a crucial opportunity to evaluate your cash flow and whether making the monthly repayments will be practical for your business. The more realistic they are, the greater the likelihood you have of approval
Additionally, be sure to check your credit score – and your business’. Not only does this give you an insight into what the lender can see, and whether your score could positively or negatively influence their decision, but also the chance to take steps to improve your credit score before applying. You can check your credit score for free here.
Whether you’re applying for £10,000 or £150,000, at Esme Loans we have the same eligibility requirements regardless of the size of the loan you’re applying for – meaning that there’s no additional red tape for you to overcome when thinking big.
In order to be eligible for an Esme business loan, we require the following:
As mentioned, eligibility requirements can vary between lenders and loan amounts therefore it’s best to check that you meet them before applying. However, if you are wanting to increase your likelihood of an approved loan application, take active steps to improve your business’ desirability with lenders and make your application stand out, for the all the right reasons.
To give you an idea of how much your monthly repayments could be, try our business loan calculator. You can also apply for a business loan with Esme using our easy ten minute application form.