Four Elements that Make Up a Good Financial Lender
If you read Direct Capital‘s post on What to Consider Before Financing, you are ready to take the next step on your journey. But, if you are just getting on board your financing journey here, there a few things you want to know before choosing the right lender.
- What do you need financing for? How will that financing benefit your business?
- How do your finances look? Are there any red flags?
- How soon do you need the funds?
With the answers to those questions in mind, it’s time to find a lender.
It’s important that while you are on this journey you don’t just settle for the first bank or lender you see along the way. There are a number of factors that you need to consider before you make the final choice.
The most significant of those choices is deciding what type of lender you want: A traditional bank or a non-traditional “alternative” lender. An alternative lender will lend money to businesses that may be unable to qualify for a bank loan, but have a sustainable business.
Chances are good that you are a sustainable business, so why isn’t a bank lending money to you?
- You have no history of borrowing.
- The bank itself might be overly cautious and think they won’t make a profit off of your loan.
- The bank doesn’t think you can realistically pay them back with the current assets and responsibilities you have.
- You don’t have a very good credit score.
- You have a bad reputation as a borrower.
Now that you can better decide which type of lender will best suit you, it’s time to choose which one you want to partner with.
A good way to help you determine not only the type of lender you want, but the actual company, is to do a quick Google search. Read up about each lender you are considering and, if you aren’t finding an A+ rating on the Better Business Bureau or positive reviews online, then you may want to start looking elsewhere.
What else should you be looking for?
- A track record: Being nationally recognized by magazines like Inc. 500 shows that the company is steadily growing, is well-known in their industry, and has proven success working with their customers. That’s a company you want to partner with.
- Long-term relationships: You want to find a lender you think you can work with long-term. Are they genuinely interested in helping your business, or just furthering their own? Will they be around the next time you need financing? These are important questions to ask yourself before deciding.
- A loan that fits your needs: Be sure you are going with a lender who can meet the requirements you have. Do you want a deferred loan, or a loan with a shorter term to get it paid off quicker? Determine what you’re looking for and see which lender can best meet those needs.
- Good customer service: Part of being a financing company is building relationships, trust, and credibility with customers so if you feel like you are just another deal or just another dollar, you may consider choosing another lender.
While on your journey, you’ll come across Direct Capital. In our 20 years, we’ve financed over $2.25 billion for more than 80,000 businesses in the U.S. Our equipment financing options are many, but include rates as low as 5.49%* and terms from 30 days to 72 months. Plus, it usually only takes about 3 minutes to know if you qualify!
To learn more about financing with Direct Capital, please visit our website!
*Interest rates subject to change. Rates as of publishing date (November 25, 2014).