Hotel and Guesthouse – Criteria For Loan Approval!

Hotel and Guesthouse – Criteria For Loan Approval!

You may want to set up a hotel and are looking out for funds to start of or expand your old one. Commercial finance for your guest house will offer you funds to buy a property, build a hotel, get your appliances and a vehicle for your business. Banks may reject loans for small business owners but there is a solace in the form of commercial brokers who will help you out if you have a small business set up.

Commercial lenders will consider your credit scores, asset value, business plan on the basis of which your loan amount will be approved. If your credit score is low, they will not deny you the loan but the size of the loan may be smaller. Your loan rates may also be set high as they have to take risks in lending loans to a poor credit holder. If possible, you may choose to repair your credit scores by closing those accounts which have smaller pending amount. This will reflect a positive credit score on your report.

Your asset will be the next best determinant of your loan rate. If your asset value is higher it will definitely attract better rates. A creditor needs some assurance that in case you don’t repay the loan on time, he will have some asset which will provide him guarantee of repayment.

Business plan is also considered before approving funds for you. It shows a creditor how good a candidate you are, do you have workable and lucrative plans. If a creditor is assured of this, he will be sure that you will repay your loan on time and your business will do well. There is no risk involved in lending funds to you.