{"id":1755,"date":"2023-10-11T09:18:04","date_gmt":"2023-10-11T09:18:04","guid":{"rendered":"https:\/\/first-exchange-bank.flywheelsites.com\/?p=1755"},"modified":"2024-03-18T13:08:38","modified_gmt":"2024-03-18T13:08:38","slug":"how-to-apply-for-your-first-business-loan-everything-you-need-to-know","status":"publish","type":"post","link":"https:\/\/www.firstexchangebank.com\/how-to-apply-for-your-first-business-loan-everything-you-need-to-know\/","title":{"rendered":"How To Apply For Your First Business Loan: Everything You Need to Know"},"content":{"rendered":"

As a new business owner, you\u2019ve got a lot on your plate. You may dream about what you\u2019d do with your first business loan, but actually researching the process and taking that step to apply can feel overwhelming. Luckily, we\u2019ve broken down pertinent information for you in this handy guide to applying for your first\u00a0business loan.<\/a>\u00a0Keep reading to learn the 4 steps to apply for a small business loan!<\/p>\n

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Get your credit in order<\/h2>\n

If you\u2019ve never applied for a business loan before or don\u2019t have a substantial business credit history, you may need to use your personal credit to obtain the loan. As with any loan application, such as a mortgage, you\u2019ll want to get ready beforehand by monitoring your personal and\/or business credit and making sure your credit report is in good order and your score is where you want it before you apply.<\/p>\n

Personal vs. Business Credit Score: What you need to know<\/h2>\n

You\u2019re probably already familiar with personal credit scores. While the FICO\u00ae Score may be the most well-known and used, there are other models for calculating a personal credit score. First Exchange Bank generally uses personal credit scores for business lending.<\/p>\n

However, there are other credit scoring models specifically for businesses. While personal credit scores generally range from 300-850, business scores tend to have a smaller range, from 0-100 (so don\u2019t be alarmed if you see a low score). Another difference is that business credit reports are associated with EINs instead of Social Security Numbers. Also, your business credit score can be checked by anyone, anytime. You don\u2019t need to give permission.<\/p>\n

The PAYDEX\u00ae Score is one of the most popular business scoring models. Ranging between 1 and 100, it is a dollar-weighted indicator that reflects a business\u2019s past payment performance.<\/p>\n

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Determine what type of business loan you need<\/h2>\n

Once you have your credit score and report in order, it\u2019s time to narrow your options and decide on the type of\u00a0commercial loan<\/a>\u00a0that will best meet your needs and goals. You can start your research process online, with articles like this one, but you don\u2019t have to make the final decision on your own. When you have a relationship with a\u00a0business lender,<\/a>\u00a0they will ask questions and have conversations with you to make a recommendation on the best type of business loan for you.<\/p>\n