The start-up loan is a capital made available by someone else. This is intended to help you set up your own company. This can make it easier to set up your own company. The easiest way to get such a loan through your own bank. There are also options, for example, to include microfinance or subsidies in the whole.
A good concept when starting a business is important
If you want to get a start-up loan, you have to have a well-thought-out concept with regard to your own start-up project. Otherwise, no start-up loan will be made available. It is therefore important to convince potential sponsors of your own project with its concept. Such a concept is known under the term: “business plan”. In any case, this must contain a good financing plan, but also a well-thought-out marketing concept.
Normally, when you think about a business start-up loan, your own house bank would be the first important contact for those willing to start a business.
Depending on which financial options you bring yourself, you can then decide whether additional funding will be included in the overall planning or not. The federal government guarantees such funding, for example, the Cream Bank. In order to be able to apply for this funding, your own house bank is required and desired as a partner at your side.
If you get public funding, this can bring some advantages, because you can expect low interest rates, a long term and also hope for repayment-free phases.
Possible means of funding
Collateral deposited is generally important for a bank and is usually desired by it. The situation for start-up loans is similar to that for other loans, since such guarantees are welcomed by most banks because they provide additional security for the banks with regard to the permanent payment of the contributions, i.e. the payment of the costs incurred for the bank Credit.
Such guarantees can come from the private sphere or guarantee banks can be involved in the project.
In this way, up to 80 percent of the total amount of the loan is usually secured. If you are not successful with the banks, so-called microfinance can be considered and included in the planning. In this way you can get up to 25,000 USD. This amount could be sufficient for smaller companies.
A good start-up concept is also very important and helpful for a successful start. If you can present a good concept as a prospective entrepreneur, then numerous investors will be found for the project, who will be happy to support and support the start-up.
What is an entrepreneur loan?
This loan represents a special form of loan. The loan is aimed primarily at the self-employed and start-ups who want to build a successful company. The amount of an entrepreneur loan is guaranteed is individual and is contractually defined each time. Of course, the creditworthiness and collateral of the borrower also play a decisive role here.
It is also important which legal form the company has. The legal form determines whether the company can borrow at all or not.
Loan for young entrepreneurs
The loan is particularly worthwhile for young entrepreneurs who want to start their business first. Most of the time they lack the financial means to start up such a business. This should be guaranteed with an entrepreneur loan.
The full amount of the money is immediately available to the borrower. It can then use it for the company according to its wishes. However, an entrepreneur is more difficult to obtain credit than is the case with private loans. This is due to the fact that the young entrepreneurs can not normally prove a regular income.
Nevertheless, this type of loan offers many advantages. Many banks have set up special repayment options for companies.
In good economic conditions, for example, they are able to repay the loan in full at once. The monthly rates can also often be adjusted upwards variably. So the company can of course also save interest. Furthermore, it is possible to reduce the monthly payment rate in the event of financial bottlenecks.
This means that the money can be reinvested in production. In most cases this is also possible without additional costs. So this form of loan is much friendlier for young entrepreneurs than a private loan.
However, such loans are often also tied to maximum amounts. However, these amount to several million USD. This loan is therefore completely sufficient for medium-sized companies. The terms of these loans are very variable.
Most, however, last for at least five years. No repayments are made in the first year. It is also possible to run a loan for ten years and not have to pay it off in the first two years. Even terms of up to 20 years can be contractually specified.
The requirements for a business start-up loan:
Of course, borrowers also have to meet certain conditions to receive such a loan. Not only must contractual formalities be observed, but you should also have a little skill in the area of negotiation as a young entrepreneur. So you can get a lot out of this loan. The entrepreneur has to provide credible evidence that he can have sufficient commercial and specialist skills in his future commercial branch.
This always works best with a professional qualification in this area. Furthermore, the company he wants to found has to deny his future main business.
An entrepreneur loan is generally possible for foreign and domestic companies. The only requirement is that they are commercially active and are predominantly privately owned. In addition, the turnover of a company must not exceed 500 million USD. If this value is exceeded, the bank does not consider a loan necessary because the company could also finance itself.
It is also possible that German companies can apply for an entrepreneur loan even though the company is operating abroad. In addition, the borrower must provide collateral for the loan. The type and scope of this collateral depends on the bank that issues the loan and the amount of the loan.
For example, if an entrepreneur takes out a loan of 20,000 USD and purchases a car for his company, he can benefit from flexible terms and 100 percent immediate repayment options. If one assumes a term of 72 months and a normal interest rate of 8.75 percent, this loan would be possible for the entrepreneur at a monthly rate of EUR 357.34.
A business loan can also be seen as a mini loan for a possible company. It has not become easier to get such a loan today, because everyone has to be fully creditworthy. Of course, the risk that lies behind a loan must also be taken into account.
Important for a business loan for founders
A business loan can be applied for by the self-employed or by traders. There is a smooth transition in terms of financing the loan and other funding. This is guaranteed by the fact that the market for investments is directly accessible to the companies.
The word “funding” should be used for an entrepreneurial activity, because it can reveal unimagined potential with regard to the possibilities of financing the entire project.
How do you find a good business loan provider?
Here it is advisable to compare at least credit providers with each other, because the interest on a loan, the terms and the fees incurred for processing the whole thing can vary greatly from provider to provider. Therefore, it is very good here if you evaluate this well beforehand and make and carry out corresponding comparisons for yourself, so that in the end you decide on the best offer, which is also best structured according to your own needs and ideas.
Here it is particularly important to check the conditions of a possible loan and take a closer look at them, as these are decisive for your own project and with which you yourself have to be satisfied in the end and for the subsequent period.
A mini loan can be compared to other offers just like any other loan. Conditions, corresponding terms, as well as costs, which will be incurred, can be inquired and found out from a loan provider.
There are different banks or credit providers that offer a business loan and have accordingly adapted their own options. These then have to suit you, so you can easily choose a bank. As mentioned, a good comparison between all the providers is essential here.
Why has it become more difficult to get a business loan today?
Today, among other things, the creditworthiness of each individual is closely examined, as well as the possible available financial resources that the applicant has or does not have. In this case, there are so-called ratings, according to which the creditworthiness of a loan is determined, so that a creditworthiness can be determined earlier here.
Of course, there are still banks that offer potential or prospective self-employed entrepreneurs a business loan.