If you’re thinking about starting a business get to know your banker before you need to apply for a loan. Visit with a banker, introduce yourself, and it never hurts to describe your business idea. Get the banker’s input – make him or her part of your team.
The Banking Basics
If you already have a business, you should be cultivating a good relationship with your banker. When making deposits, don’t use the drive-in window! Going inside the bank will give you an opportunity to get to know lending officers who will be a valuable resource for you.
Either way, starting a business, or growing a business, you will need them. Before the need arises you should know a little about the bank and their lending policies. Not all banks or lenders are the same. Some banks are very friendly to small businesses, others are not. Some participate in Small Business Administration (SBA) and US Department of Agriculture (USDA) guaranteed loans, and some do not. You may hear a banker say that their bank participates in guaranteed loan programs. What you want to know is whether your branch participates, and how many business loans originating have been SBA or USDA guaranteed. Often, in the case of large regional or national banks, they may, when looking at the bank as a whole, have a good track record for participating in government programs. What you may find though, is that the particular branch or area has a poor track record for participation. For lenders, dealing with government programs, is sometimes a specialized area for which they are not staffed. It is an extra step and requires an additional level of skill and knowledge. Not all banks have the resources or mindset to go this route.
The Executive Director at the AHEDC Business Assistance Program is familiar with lending practices in the Alleghany Highlands. We are happy to serve you. As always, our services are provided at no charge.