Can I use a commercial loan to start a business?

Starting a new business is both exciting and challenging. And one of the biggest hurdles is getting the funds to make it happen. Have you considered a commercial loan? It’s a type of financing specifically designed for businesses, and it can help cover expenses like equipment, inventory, hiring, and renting office space.

But before you jump in, it’s important to have a solid business plan in place. This should include things like your target market, your marketing and sales strategy, and your financial projections. The more detailed, the better. Lenders want to know you’re a good investment and capable of repaying the loan.

Another important factor to consider is your credit score. Lenders will check your credit history and score to determine whether you’re a good candidate for a loan. If your credit score is low, don’t worry, you may still be able to get a loan, but you might have to pay a higher interest rate or provide additional collateral.

Finally, take the time to shop around and compare different loan options. Different lenders have different terms and interest rates, but they also have varying levels of apetite for new businesses depending on the industry, the experience of the business owner, the available security, proposed loan terms, and the reliance on income from the new business. Banks will also price their loan products based on their risk. A good commercial mortgage broker will work with you and your accountant to build a workshop foryour application and present this to multiple banks for tender, before a formal application is submitted.

A business loan can be a great option to finance your new business. Just make sure you have a solid business plan, a good credit score, and work with an experienced Commercial Mortgage Broker who will spend the time to tender your application with multiple lenders and find you the best possible deal. With careful planning and research, you can successfully launch your new business and achieve your entrepreneurial goals.

Luke Meisenhelter

With over 14 years in the finance industry Luke has helped countless clients achieve their finance goals. As the Managing director and founder of Loanright Financial services Luke now manages a team of experienced mortgage brokers with a combined total of more than 60 years finance experience in residential and commercial lending as well as business and asset finance. As a leader the finance industry Luke has become an innovator in the game, mentoring and coaching other industry professionals and pushing the limits on process driven workflow structures, systems, and accountabilities, aimed at providing the best possible financial outcomes for all clients in the shortest possible time frames. Throughout his years in the finance industry, Luke has become increasingly frustrated with the quality of information available to consumers in the property and finance market, most of which is biased and designed to capture leads by creating fear and offering a magic solution. It’s Luke’s goal to share his knowledge and provide free, non-biased, quality sources of information on finance and financial concepts to as many Australians as possible.