Finding the capital to help start or grow your business is never easy. This is especially true in the healthcare industry. Businesses require expensive machinery and other significant expenses to even get started. Therefore, many people are looking for ways to finance their healthcare businesses. The following information will help you succeed at this.
Types of Loans
There are a few ways that you can get the startup or expansion capital that you need. These are a few loan options to consider:
- SBA Loan: The government will help you with getting a loan. These typically carry lower rates and have better terms than traditional small business loans. They are originated through lenders.
- Microloan: Some organizations (including the SBA) will help you get small loans with fewer restrictions. This can be a great way to get the basics of what you need without needing to wait as long or provide as strong financials.
- Equipment Loans: Many lenders will offer you equipment loans to help with healthcare equipment. This can often be among the most significant initial costs for new practices. Alternatively, you could look at leasing your equipment.
How the Decision Is Made
When you are applying for any type of business loan, the lender will examine a few key figures to determine your creditworthiness. The first is your credit history. As your business grows, it will develop its own credit profile. However, if you are just starting, this will be your personal credit history.
Second, the lender will look at the working capital and collateral that you can provide. Additionally, they will likely want to see that you have made an investment in the business yourself. Having “skin in the game” helps to ensure your seriousness.
What You Need To Provide
When you apply for a loan, the lender will need some documentation to make a decision. These are a few commonly requested items:
- Several months of bank statements
- Financial statements (balance sheet, income statements etc.)
- Other debt documents if you have existing loans
- Tax returns of the business and owner(s)
You may need additional information such as your business formation documents. It can be helpful to get your records ready before you start applying for loans.
Discover more about financing a healthcare business today. When you know your options, you will be better prepared to make the right decision for your company. Find the right lender and help your business succeed.