For most businesses, having enough capital to operate, thrive, and grow requires taking on debt such as a commercial loan, for example. However, when there is too much debt or the wrong type of debt, a company can get into financial difficulty. A useful solution can be a debt consolidation loan which is simply combining loans, then refinancing them with a single loan.
Reasons to Seek a Debt Consolidation Loan
A debt consolidation loan can provide significant relief for a business if debt payments are taking up too much of the business’s cash flow. The problems may include high-interest rates, multiple cash advances, or balloon payments. If a business needs to delay payroll, juggle supplier payments, or defer critical expenditures, then there is a debt problem. The goals for debt consolidation are to reduce payments, lower interest rates, and extend payment terms.
How to Get a Debt Consolidation Loan
Follow these steps to get a debt consolidation loan:
Review your business’s financial needs. Determine which debts are a problem for your business. Then determine how much capital you will need.
Review potential sources for a debt consolidation loan and decide where you want to apply for a loan.
Have an initial meeting with a lender. The lender will review your financial history and consider: if the company is profitable; if the company has had a bankruptcy or defaulted on a federal loan; how the company will use the loan proceeds; if your personal and business taxes are in order; and the quality of your personal and business credit score.
You will need to deliver personal and company financial documentation to the lender who will follow a process of due diligence for the loan.
After the loan is approved, a closing date will be scheduled, documents signed, and funds released.
Seek Expert Financing Assistance
Contact Capital Finance Partners to secure the funding you need. We offer a comprehensive portfolio of loan products to grow your business.