Get Your Business Funded: Creative Methods for Getting the Money You Need

Increasing Your Chances of Getting Funded

As stated, business loans are not easy to get these days and it may be that you even need some extra help getting approved. Maybe you are new to business and have no track record or maybe your personal credit isn't the best . . . whatever the case, here are some final ideas:

Get a co-signer. A co-signer, as you know, is a person who chooses to sign on a loan in addition to the original borrowers. The purpose of a co-signer is to have an additional person with good credit on the application and willing to be responsible for repayment. By co-signing, the co-signer is agreeing to also be personally liable on the loan. He or she is as equally responsible for the debt as the other borrowers—not more, not less. Co-signing means that the debt will be reported to the co-signer's credit report and will go against his or her debt-to-income ratio. The debt's repayment history (for good or ill) will also be reported to the co-signer's credit report. If the debt is not paid back by the business or other borrowers, the co-signer will be liable for the debt.

In the case where a borrower must personally guarantee a loan (not uncommon in a business loan situation), having a co-signer can also make a big difference.

Needless to say, co-signing is a tremendous responsibility and should not be undertaken or requested lightly. Business is a risk, and not every risk pans out. So, while you may have someone close to you willing to co-sign, be aware that should ...