How to Get a Loan to Start a Business?

Business loans for new startup businesses are particularly risky because the bank doesn't have any proof of your ability to successfully run a company and turn a profit. For this reason, the process of getting a loan to start a business starts well before you walk into a bank. You have to do some preparation before submitting an application to a lender.

Step 1

Prepare a full business plan if you plan to apply for financing for your new business. Most lenders want to see your plan along with financial projections when making a decision about whether to fund a new company. The strength and thoroughness of your business plan is one of the most important factors of the business loan application. Be sure to include research on similar businesses or case studies.

Step 2

Register your company with the state before attempting to get business financing. Most lenders want to see that you are an established business with a business registration, license (if required) and fictitious business name ("doing business as" name) filing with the state. See Resources to find your state's business registration website.

Step 3

Visit the bank of your choice, but make sure that the bank does commercial lending, to apply for the loan with your business plan, resume, financial statements and other data in hand. Fill out a credit application with information about your business including company name, tax ID number and your personal Social Security number. Give detailed information about your intended business activities and what you plan to use the funds for. Provide any additional documentation required promptly.

Step 4

Wait for a decision from the lender, which could come within a few days or weeks depending on the bank.