If you’re an established business and are focused on growth, you may be searching for a business loan to help you accomplish your goals. But before you apply for a loan, you’ll need to determine the best amount to ask for? If you borrow too little, you won’t accomplish your goals; and if you borrow too much it could be a financial burden. So how do you establish the “correct” amount when seeking out loans for businesses?
Consider the variables
The answer is simple, and yet endlessly complicated. There is no right amount for a business loan. There’s no algorithm or equation that tells you how much to borrow; it’s all up to human logic.
The right amount is entirely dependent on a host of factors, including:
- Your business type
- Your business needs
- Your plans with the funding
- Your cash flow and expenses
- And more
If you have a dedicated finance department, then you likely have somebody standing by to assist you with these decisions. But chances are, as a small or medium-sized business, you are your own finance department. How do you make that kind of decision without years of experience crunching numbers and assessing risk?
You may be tempted to borrow a large amount of cash; overshooting your expansion budget (or whatever business project you’re funding with the loan). That way, even if expenses end up being higher than projected, you still have enough cash to cover it.
But keep in mind that the higher the loan, the higher the fees. If you borrow more than you can afford to repay, you can find yourself in an endless cycle of debt. When you take out a loan responsibly, and for the right amount, a loan is an incredible business asset that offers you opportunity, growth, and success. It’s not supposed to be a financial burden.
At the same time, if you’re too risk-averse, you may end up borrowing less money than you need. You find yourself short on cash while upgrading equipment or planning a location move, and you can’t carry out your plan as you intended. Now you’re left repaying a loan that didn’t benefit you to the fullest extent.
As you can see, neither borrowing high nor borrowing low is a safe strategy… you need to borrow the right amount for your needs, no more or less.
If There’s No “Right Amount,” Then How Do You Decide?
If you don’t know how much capital you need, then you need to enlist the help of finance professionals to figure out a game plan. What better finance professional than your very own lending partner? You already have a relationship with them (or intend to begin one), and they know the intimate details of loan finances.
The Only Lending Partner for Your Needs
Mulligan Funding helps small business owners figure out lending solutions every day. It’s common for business owners to contact us knowing that they need a loan, and knowing what they want to accomplish with the loan capital, but not having a clear idea of how much loan capital they need to accomplish those goals.
Let Mulligan Funding Help You
We’re here to strengthen and grow your business. Speak with one of our financing professionals and share the details of your business plan, whether you’re looking to revamp your cash flow situation or expand your business. We’ll help you to figure out how much you need to accomplish your goal, and how much you can repay realistically without stressing your finances or stretching the limits of what your business model can accomplish.
We’ll never provide funding for more than what we believe that you need to grow and strengthen your business. We want to see you succeed with the help of business capital, not struggle with a debt burden.
A Long-Term Financial Partner
From the moment that you come to us for your first business loan, you’re part of the Mulligan Funding family, a long-term partnership that you can rely on over and over again. You get a solid point of contact so every time you call, the same associate helps you out. We aspire to build long term relationships with each business owner we partner with. We gauge our success by your success.
We offer solid alternative to the traditional bank loans that many business owners have trouble qualifying for. Our working capital loans boast a high approval rate so you can get started even without extensive qualifications and perfect credit.
The benefits include:
- Single-page application
- Quick funding
- Simple, fee-based repayment system
- Small, manageable daily payments
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.