The Changing Landscape of Business Loan Approval Today, technology has transformed the landscape of business and financing to a great extent. There was a time when applicants had to wait for long for a business loan approval, and that too after rigorous paperwork. Although there are chances of getting a large amount of loan, thetraditional lending process usually leads to significant paperwork, prolonged application procedure, and high-value collateral security. On the other hand, modern method of loan application has changed from paperwork to online submission, for the better. Some SBA lending agencies have released mobile apps to apply on the go and ensure faster approval of business loans. Online Loan Application – A Convenient Option Many startup owners are gradually turning to online business loans for their convenience. Online loan application process involves less paperwork and quicker loan approval, sometimes within 72 hours of uploading your documents. You can even check the status of your application at every phase. With a modern data-driven approach rather than mere personal credithistory based evaluation, online SBA lenders are ready to finance startup enterprises. As a business owner, you only need to decide on the type of loan and find the right lender. How to Decide on Business Loans Many entrepreneurs run after government loans offered by the Small Business Administration (SBA) of the USA. SBA financing turns out to be a wise choice, but as a first timer, you need to know why and how an SBA loan is suitable for your business. Whether you choose from a government loan or a private loan, from traditional or online business financing options, below are a few points to consider before you come to a conclusion. The type of the business for which you need the capital Your experience and presence in the industry Current condition of your business, from financial and growth perspectives Your personal and business credit scores Remember that you need to present a solid and clear business plan and an impressive payment history in front of the lender to get your SBA loan approved without delay. There is a variety of loan programs available from online SBA lenders. The questions are: How much money do you need to fund your business? When do you need the money? What are your available loan options? What is the interest rate and repayment term for each loan program? How much collateraldo you need to provide for the amount of loan you need? Based on these findings you can decide the loan program and application process. For example, if you are in urgent need of capital, it is better to apply for SBA loans online. Reasons to Choose Government Loans SBA is a US government department, known for its startup-friendly loan programs, for instance, Microloan and Community Advantage Programs. While many private banks and for-profit lenders charge high rate of interest,SBA loans come with lower interest rates and longer repayment terms. With an aim to provide financial support to boost startups and small businesses, SBA has designed loan programs depending on their specific needs. These loans are offered through SBA-approvedbanks and lending agencies. However, a decent credit score is a prerequisite in both the cases. When comes to government loans, chances of approval is higher in thecase of partially self-financed enterprises. As a business owner, your industry-specific experience and management ability also count. The best thing about SBA financing is that sincethe lenders know that the government will repay for defaulters they are more open to offering loans to startups. Moreover, SBA loans can be used to serve different purposes, such as: Buying new equipment, machinery or office supplies Mortgage on commercial property Refinancing an existing debt Establishing a business line of credit SBA Loan Programsand Application Process From new business venture to expansion to disaster recovery, SBA loans are designed to cover various business needs. Microloan Program:It is a shot-term loan program applicable for the purchase of office furniture, equipment, goods, and transportation. The upper limit for this type of loan is $50,000. CDC/504 Fixed Asset Loan Program:Community Advantage loan program provides fixed-rate and long-term loans to applicants whose business models can directly benefit their communities by creating job scope or developing an undeserved area. The upper limit for this type of loan is $5 million. 7(a) Loan Program: This is a popular SBA loan program to help entrepreneurs set up a new business or expand their services. The maximum loan amount you can get is $5 million. Usually, this type of loan is offered by traditional lending agencies. Therefore, you can expect more restrictive terms and conditions and underwriting standards. Disaster Loan Program: SBA sanctions Disaster Loans to large and small business organizations, NGOs, homeowners and renters to help them restore their damaged properties at lower interest rate and long repayment terms. Now you know that before applying for a loan you need to assess your business’ present financial situation. Once the evaluation is complete, find the right lender for your business. It can be a commercial bank or a non-banking financial service provider or an online SBA lending agency. Prepare and submit your loan application with proper supporting documents and financial information including last three years’ tax returns and wait for approval.