Some of the most frequently asked questions about business loans

 A business loan is an inevitable financial decision that every business owner has to make some day. When you’ll need that loan and what you’d need it for, depends upon your financial situation and the nature of your business. Some businesses need loans for expansion; some need them for providing salaries to their employees, while others need them for buying equipment that would help make the production process more efficient and cost effective. But the undeniable truth is that every business needs a loan some day or the other. So let’s take a look at some of the most common question that people ask about business loan in Delhi.

Q: What is the standard interest rate for a business loan?

A: Typically, the standard interest rate fluctuates somewhere around 2 to 4 percent over the prime rate. Prime rate is the rate of interest that banks and other lending institutions charge to their most trusted and secure borrowers. The prime rate itself can go up and down and interest rate moves relative to that.

Q: Should I make myself look presentable when I visit the bank?

A: There’s an old adage that says bankers prefer lending money to the people who look like they don’t need it – and it isn’t without the truth. It doesn’t matter what your business is, but if you’re going to visit a bank to borrow a loan, you need to dress up in professional attire. Don’t underestimate the power of the suit!

Q: Do banks visit the business that want to go for a loan?

A: It all depends upon the amount of money that you’re looking to borrow. Chances are that if you’re borrowing a relatively small sum of money, not many banks would be interested in performing a site visit. They’d rather be more interested in evaluating you as a person. They’d see if you’re dedicated and passionate enough for the business and if your business model is actually profitable. But if you borrow a substantially large sum of money, then a bank would probably want to conduct a site visit to know about your business in detail.

Q: Should I be worried if I’m 30 days late for a loan payment?

A: There is no need for you to be worried at all. Just inform your banker that you’d be late and inform why. Also, give them a date on which you’d be able to pay so that they can rest assured. Banks have to deal with defaulters all the time and it’s something happens in business. So relax.