![]() A good credit score proves that the business owner has properly managed both of their personal and business finances by avoiding bankruptcy and making all of their payments on-time.Ī poor credit score, however, can make lenders wary since it demonstrates that the individual can not make well-informed financial decisions and are unable to meet the financial obligations that are included in the loan agreement. Bad creditĬredit history is one of the first things that lenders will review when going over a business loan application. ![]() Sometimes a bank will share these details, but if not, I find that it's typically for one or more of the following five reasons: 1. That’s why you should know exactly why your loan was rejected in the first place so that you can make sure that it never happens again. However, getting rejected is never fun, even if the circumstances are out of your control. The Wall Street Journal reports that it may be because of, “Weak demand, tighter lending standards and high costs have put a lid on small business borrowing” following the 2008 economic crisis. ![]() Over the last couple of years, large banks have been reducing the amount of loans that they’re issuing to small businesses. You were counting on that small business loan to help your business grow, but the bank said "no." If it makes you feel any better, you’re not alone.
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