BusinessLoans.com

Can I get a business loan after bankruptcy?

A bankruptcy in your past doesn’t necessarily preclude you from getting a small business loan, but it might make it more challenging. While not all lenders have the same requirements after bankruptcy, it’s unlikely a borrower would qualify within the first year. Many lenders will require at least one year of improving credit history following the disposition of a bankruptcy.

What is collateral?

Collateral is any asset or assets, which can be offered by a borrower to secure a loan. Should a borrower default, the lender can take possession of the asset, or assets, to satisfy the loan. You can read more about collateral in our Business Owners’ Guide to Term Loans.

What is a personal guarantee on a small business loan?

It’s common practice for lenders to require a personal guarantee from the business owner(s) to protect the lender should the business default on the loan. Lenders do this to mitigate the risk of lending to small businesses, and the guarantee is often a requirement by the lender before offering a loan. In the event of a default, a personal guarantee gives the lender additional options to collect the debt.

Do I need a business plan to get a loan?

That all depends upon the type of loan you’re looking for. To qualify for an SBA loan you’ll need a business plan. While other lenders might not require a formal business plan, they will ask questions about loan purpose, how this loan might positively impact profitability, etc. Whether or not a lender requires a business plan, it’s a good idea to go through the exercise so you can articulate why you are looking for a loan and the benefit you expect to gain from the capital.