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This blog was last updated on May 24, 2021.
As a small to mid-sized business owner, you’re often faced with important decisions that will impact the overall health of your business. And when it comes to choices regarding your business’ financials, you may find yourself stressing over your current options or wondering what to do next – and rightfully so!
Confronting a daunting cash crunch or even planning for a costly remodel can certainly qualify as a stressful business decision. Cash flow is crucial to any business’s survival, and a shortage can mean your company is at risk.
But when should you apply for a business loan to help cover costs? Read on to learn why applying for a business loan before you’re desperate for one could work in your favor.
3 Benefits of Applying for a Business Loan Sooner Rather Than Later
Based on our experience working with small and mid-sized businesses since 2008, there are a few reasons why you may want to apply for a business loan in preparation for future plans rather than waiting to make a move.
1. You Likely Make Better Decisions
As noted above, a business’ financials can induce anxiety and stress for any business owner. After all, planning for your company’s future, working towards major updates, or deciding whether to apply for a business loan are all hefty choices.
But, extreme stress isn’t healthy for anyone facing a large decision. Stress hinders our decision-making ability and increases the chances that we’ll make the wrong move.
So, for business owners contemplating applying for a loan, it may be best to approach the topic when you have some wiggle room before you’re in dire need of additional working capital. Looking into your loan options in preparation for your future goals rather than in a panic may help you make a more sound decision.
2. You Could Leverage Better Loan Options
When you absolutely must have more cash in your business, you may feel forced to accept limited options or pay a premium interest rate. Not because lenders are taking advantage of you, but because your business may not be in a relatively strong borrowing position by that time.
When you feel you’re down to the wire and financially pressured to secure a business loan, you may not have the time you wished you had to explore your options and find a borrower that fits your needs best.
After all, there are lots of business lending options to consider. From traditional business funding vs. alternative business funding and everything in-between, it’s important to allow yourself the necessary time to thoroughly look into your options.
3. You May Have More Control
By getting out “in front” of your business borrowing needs rather than being forced to scramble for cash, you may be able to choose to borrow in stages.
For example, instead of borrowing $100,000, you can borrow $75,000, spend it accordingly, and then decide whether to borrow additional funds and if so, how much. This approach simply gives you more control over your borrowing and your debt level.
At Mulligan Funding, qualifying clients can choose to renew their working capital loan through our team. Plus, even before their initial loan is completely paid off, our customers have the option to apply for additional funds1 which can help prepare them for future business goals.
No one knows your business better than you do! But if you’ve been thinking seriously about an expense or making a major investment and need a cash infusion to make it happen, then applying for a business loan now rather than waiting until you desperately need one could help your business stay strong and successful.
And, if and when you’re ready to take the next step and learn more about funding options available to you, the Mulligan Funding team is here for you! With a seamless application and approval in as soon as a few hours*, our loan advisors are ready to help.
Call Mulligan Funding at 855-326-3564 to discuss your financing options today!
The information shared is intended to be used for informational purposes only and you should independently research and verify.
Note: Prior to January 23, 2020, Mulligan Funding operated solely as a direct lender, originating all of its own loans and Merchant Cash Advance contracts. From that date onwards, the majority of funding offered by Mulligan Funding will be by Loans originated by FinWise Bank, a Utah-chartered Bank, pursuant to a Loan Program conducted jointly by Mulligan Funding and FinWise Bank.