Managing a business is one of the most difficult things to do, and one of the things that make running a business so hard is managing the repayment of multiple loans. If a business owner participates in loan stacking by taking out many loans during their lifetime, they will have to manage repayment on all of them concurrently. That's a lot of work. Consolidating business debt can help relieve a business owner of this tremendous burden. A successful consolidation can lower monthly payments, save the business money in the long term and allow a business owner to have a single due date for their loans instead of many separate individual ones.

When to Consolidate Business Debt

When paying back multiple business debts becomes difficult, it could be time to look at consolidation. Even if it is easy to pay back multiple loans, a business owner can consolidate their loans to achieve certain desired effects. One can try consolidating particular loans to achieve a lower monthly payment. This can free up money that can be used for other projects. Consolidation can also be used to save money in the long term by paying back loans with high-interest rates.

Applying for a Business Consolidation Loan

The application process is extremely simple. Applications can be readily found which will explain what documents will be required to submit to the vendor. Annual tax returns will prove annual income and the vendor will look up the personal credit score of the applicant. A business plan will most likely be needed as well. Vendors will often contact an interested applicant if they need any more information to determine their eligibility.
In conclusion, consolidating business debt has never been easier. With the advent of internet vendors, almost anyone can apply for a business consolidation loan. If one is unable to secure funding with local banks, the SBA or internet vendors, one may consolidate small business debts with business credit cards.
Local banks will offer the best rates and require the highest qualifications. If a business owner is unable to secure the contract that they desire, they can always apply again in the future. After at least three months, a business owner can present an improved financial situation to their vendor.
Since business owners will likely take out more than one loan during their lifetime, they should be informed about loan consolidation. Consolidating loans can secure lower interest rates, lower monthly payments, and an easier repayment schedule. With a good credit score and solid business history, business owners can keep advancing with their private enterprise to make their dreams come true.

Consolidation or Refinancing

Consolidating business loans is not the same thing as refinancing them. Refinancing a loan refers to taking out a new loan with a lower interest rate to pay back a loan with a higher interest rate. The point of refinancing a loan is to save money through obtaining a lower monthly payment.
Consolidating business loans refers to taking out a new loan that will be used to pay back multiple loans. The major benefit that comes with consolidation is having only one loan to pay back instead of multiple ones. It takes a lot of planning to coordinate multiple repayment schedules, and a business consolidation can ease this hardship significantly.

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Where to Get a Consolidated Business Loan

Consolidating business debt is most efficiently done through a local bank. Banks offer the lowest interest rates with the most generous repayment terms. They are also the most difficult vendor to acquire a consolidated loan from.
Banks like to see that their investment will yield profits. They often only accept businesses that have been operating for at least two years and have significant annual revenue. The next best option would be to apply for a loan through the Small Business Administration.
This process can take some time, but getting a loan through the SBA can yield results similar to banks. Finally, some online vendors can consolidate business loans. These vendors won't have the rates that banks or the SBA have, but their application process is fast and can be used as last resort.

Important Qualifications to Have

Most vendors that offer consolidated loans will only accept businesses that are already established. This means that businesses should be in operation for a minimum of one year and have annual revenue of at least $25,000. Having these estimates should allow one to find a vendor to consolidate their business loans.
A personal credit score of above 650 is also a good qualification to have. Any number less than 600 might make securing a consolidated loan difficult. A business should also be in good standing and not have marks like bankruptcy or liens in their records. If one doesn't meet these qualifications, they can always stay in business longer to gain additional operating time and an increase in revenue to prove to a vendor that their business is stable.