When you’re starting a business, there are a lot of things to think about. One of the most important is how you’re going to finance it. Many people turn to business loans to get their businesses off the ground. But what do you do if you need a mortgage for your personal home and a business loan? In this blog post, we’ll walk you through the process of applying for arm loans and give you some tips on how to make the process as smooth as possible.
Decide the Type of Loan
If you’re applying for a mortgage and a business loan, the first thing you need to do is figure out which type of loan you need for each. A mortgage is a loan that’s used to purchase property, while a business loan can be used for a variety of purposes, including start-up costs, equipment purchases, and working capital. Compare different offers from lenders. This includes looking at interest rates, loan terms, and repayment options. It’s important to find a loan that’s right for your business, so take your time and shop around.
As your shop around beware of racking up hard pulls. Hard pull are credit inquiries that stay on your credit report for two years and can ding your score by a few points. So if you have multiple hard pulls in a short period of time, it could have a negative effect on your credit score.
Get Your Documentation Together
Once you’ve decided which type of loan you need, it’s time to start gathering the documentation you’ll need to apply.
For a mortgage, you’ll need :
• tax returns
• proof of income e.g. pay stubs
• employment history
• asset information
• bank statements.
For a business loan, you’ll need things like:
• business plan
• financial projections
• tax returns.
• financial statements
• other documentation that shows the lender you’re a good credit risk.
If you’re applying for both a mortgage and a business loan, you may be able to use some of the same documentation for both. For example, if you’re using your tax returns to apply for a mortgage, you can also use them to apply for a business loan.
Submit your Loan Application
The next step is to actually apply for the loan. This process will be different depending on the type of loan you’re applying for. For a mortgage, you’ll need to fill out a lengthy application and go through a credit check. The process is similar when applying for a business loan. For a business loan, the application process is usually shorter and less invasive. You’ll still need to go through a credit check, but the application itself is usually much simpler. Many lenders will allow you to apply online, but some may require you to come into their office to fill out an application.
Once you’ve applied for the loan, the lender will review your application and make a decision. If you’re approved, you’ll need to sign a contract and agree to the terms of the loan before getting the money you need to start or grow your business. If you’re not approved, the lender will usually give you a reason why and tell you what you can do to improve your chances of getting approved next time.
Applying for a mortgage and a business loan can seem like a daunting task, but it doesn’t have to be. By following these simple steps, you can make the process as smooth and easy as possible. And once you’ve got the money you need, you can focus on what’s really important – growing your business.
If you’re in the market for both a mortgage and a business loan, GoNoCost can help make the process easier. We have a network of lenders competing for your business, so you’re sure to find the best rates and terms for your needs. Contact us to get started today!