Finding the right financing, and securing it, can be a challenge for most companies and those in the construction industry are no exception. You need the funds for equipment, supplies and labor to start projects and then have to complete them to get paid. Fortunately, it can be relatively simple to get a construction business loan to meet those needs, expand your company and take on more challenging projects.
Choose a Lender
Your first step is to choose a lender. It is a good idea to compare terms, fees and repayment schedules as well as reputations and application requirements to find the right one. You should also look for lenders with experience working with construction companies because these institutions will know some of the common pitfalls and challenges associated with funding projects and expanding business. Private lenders are a quicker bet than traditional bank loans with approval times averaging a couple of days instead of a couple of months, but you may have to trade speed for higher interest rates or fees.
Apply for a Loan
With more small businesses in every industry looking for competitive loan rates and terms, your construction industry company has more options than ever with some lenders offering online applications and quick approval times. In many cases, you can fill out a quick internet form, upload a few months of bank statements or other documentation and have an answer in less than a day. These lenders will also get the funds to you quickly because many know that you cannot start the job without money for equipment, permits and employees.
Budget Your Business Needs
Some lenders have loan programs with specific items you can use the funds for, which can be helpful if you need items only from that category such as equipment or real estate. Many online small business lenders will not have this type of restrictions, however, so once you are approved it is a good idea to run over the budget again and save some money for emergency or unexpected expenses. Deciding to spend a little more for a permanent equipment item which will be used on multiple projects can be a better investment in your company than getting the cheaper unit.
Companies in the construction industry have to be constantly bidding on projects and can have little to no turn around time between jobs. This can put a strain on working capital and cash flow which makes it almost impossible to expand company capabilities without financing. Fortunately, you can find lenders with experience lending to your industry, online applications and quick approval times to boost your company now and as you grow further.