How do profit increases your ability of borrowing money?

[Edward2]

Have you ever crossed this thing into your mind? Seems very ironic to hear right, but it is possible. Yes having the profit increases your ability to borrow money from possible investors. Debt lending allows a corporation to repay the money loaned with interest to the borrower. Debt funding for a small corporation usually involves a bank's borrowing of capital. Profitability of a business plays a major role in lending a bank money to the company.

Besides interest, the loan value and collateral of a business owner are deciding factors in the decisions on the loan. A business which cannot make profit is generally regarded as a risk of a lender's default.

What are your thoughts about this, is it still profitable ? Please share your thoughts.

 

[Kamon c4]

This is true. Most banks asks for financial records before lending out big money to business owners. The profit and loss accounts of the business owner gives the loaner clarity of payment. A company with records of high profits gives the loaner assurance of payment in due time. It’s very important before opting for loan

 

[Trexxxy]

I think it is a good way to go. The business is making profits as it is, now wants to borrow more to capitalise, expand and grow even more, which would mean more profit. Any bank wouldn't think twice to borrow such business.

 

[Nurudeen]

Assuming for example you have a good business giving you some good amount of profit at the end of the day, it will be very easy for you to borrow money or take a loan to do any other things or to expand your business since it's very sure you know the amount of money you earn per day

 

[kayode10]

Have you ever crossed this thing into your mind? Seems very ironic to hear right, but it is possible. Yes having the profit increases your ability to borrow money from possible investors. Debt lending allows a corporation to repay the money loaned with interest to the borrower. Debt funding for a small corporation usually involves a bank's borrowing of capital. Profitability of a business plays a major role in lending a bank money to the company.

Besides interest, the loan value and collateral of a business owner are deciding factors in the decisions on the loan. A business which cannot make profit is generally regarded as a risk of a lender's default.

What are your thoughts about this, is it still profitable ? Please share your thoughts.

The percentage of profit your business generate is one of the key features potential investors looks into before they can invest into your business or a project. The same thing goes for if you want to take or obtain a loan from financial institution. Check how possible for you to repay back the loans in a short period of time and again we are going to be from it.

 

[Khezo]

Well i think it's possible to increase your loan collection with the increase in your profit. The thing is just very simple. The more the bank notice you have or seeing profit in the bank the more ur loan funds would arise
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Well i think it's possible to increase your loan collection with the increase in your profit. The thing is just very simple. The more the bank notice you have or seeing profit in the bank the more ur loan funds would arise

 

[Ibrahim1]

As for me you are right and moreover Banks don't just give money out anyhow but ask for financial records before le ding big money to the company and also ask for collateral because some company's might run down and never used the money wisely

 

[Victor001]

This is feasible when the confidence in the business growth is visible,and it's mostly common among larger firm.til you get to that point it's adviceable to gather profit and simulate your business.
[automerge]1612878922[/automerge]
This is feasible when the confidence in the business growth is visible,and it's mostly common among larger firm.til you get to that point it's adviceable to gather profit and simulate your business.

 

[Sanusi]

This question is fascinating and interesting because before you borrow a certain amount of money the platform you are borrowing from will check your transaction history or what you are earning, so if it's low they won't give you. In general your earnings must be times two to three of the money you used to start a business.

 

[EMMANUEL]

Profit will definitely increase if you have a good customer relationship whereby when customers demand for any item just for trial, you give a little bit more information about the usefulness of the particular product, this makes some customers to give their level of patronage of your business a second thought.

 

[Josephjossy]

Starting a small business is good, at least you have a way of earning little money. But you have to take the business so serious for you to succeed. You know that it is a small business that you start with a small capital so any mismanagement can lead to business collapse

 

[Johnbami]

Once the bank notice you have or receives very good income or profit from your business then they would gladly grant you yh3 loan you requesting for. Everybody wants to be the friend of the rich no body wants to be on the losing side

 

[Frank]

Have you ever crossed this thing into your mind? Seems very ironic to hear right, but it is possible. Yes having the profit increases your ability to borrow money from possible investors. Debt lending allows a corporation to repay the money loaned with interest to the borrower. Debt funding for a small corporation usually involves a bank's borrowing of capital. Profitability of a business plays a major role in lending a bank money to the company.

Besides interest, the loan value and collateral of a business owner are deciding factors in the decisions on the loan. A business which cannot make profit is generally regarded as a risk of a lender's default.

What are your thoughts about this, is it still profitable ? Please share your thoughts.

I don't always feel comfortable of borrowing money from any bank in order to do business. It is such a desperate move that when one is not careful, you may end up paying so much money from the one that you borrowed. The interest rate is another thing that always put me off when it comes to borrowing money too.

 

[Seun4luv]

Increased tax revenues. Higher company profit will lead to a rise in corporation tax revenues. Research and development Higher company profit enables firms to invest more in research and development. Higher dividends for shareholders. Incentive effects. Signal effect. Savings.

 

[Donkiz]

Lending money to a business that is not making profit is not advisable, because that's a sign that the borrower will default, and the loan will turn to a bad loan. This is why most financial institutions will ask for your business balance sheet are one of the requirements for granting a loan request, the idea is to check how the business is fairing.

 

[bhennie]

If your credit score is lower than you'd like, there may be quick ways to bring it up. Depending on what's holding it down, you may be able to tack on as many as 100 points relatively quickly.
Scores in the "fair" and "bad" areas of the credit score ranges could see dramatic results leading to more access to loans or credit cards, and at better terms.

 

[Abu4exel]

Banks are not stupid when a borrower want to lend money from them. There are so many factors they consider before lending. One of those things is the lending history of that person and how he or she were able to pay back on time. They also check the type of business such person wants to take to know if its a legal or illegal business, before lending and after lending what is the financial position of that company, is it running on a profit or loss.

 

[Richard92]

Sometimes your profit can boost and increase your ability for borrowing money, when you see that the business that you are into pays more do you want to borrow and take loan in order to expand the business to make more profit.

 

[Halexcity]

Making a profit is essential for a business that desires to expand it operations. Earning a profit allows you to open other business locations, acquire another business, target other markets and expand your operations into foreign territory. The purpose of business expansion is to further increase your profits. Earning a profit is not the only factor that influences the decision of whether to expand your business, however, If you desire to grow your business, your management and back office team should be able to take on additional responsibility. You should create a business plan for expansion and analyze trends and economic factors that affect your business. Borrowing money allows you to easily expand your business in various business locations.

 

[chommyluv]

Have you ever crossed this thing into your mind? Seems very ironic to hear right, but it is possible. Yes having the profit increases your ability to borrow money from possible investors. Debt lending allows a corporation to repay the money loaned with interest to the borrower. Debt funding for a small corporation usually involves a bank's borrowing of capital. Profitability of a business plays a major role in lending a bank money to the company.

Besides interest, the loan value and collateral of a business owner are deciding factors in the decisions on the loan. A business which cannot make profit is generally regarded as a risk of a lender's default.

What are your thoughts about this, is it still profitable ? Please share your thoughts.

Money lenders even banks don't give out loan to any dick and harry. They put some factors into consideration ; The income of the borrower and the sources of payment it help the lender to be careful on how much he can lend, the income of the borrower must be sufficient enough to pay his or her debt