Financing a Start-up Business - Securing funding for a new start-up business is difficult because so many new business fail in the first year.  To be considered for funding an entrepreneur must have good credit, a good plan, good collateral, some experience in the industry or in running a business, and be ready to make a substantial personal investment in the new business.

Good Credit - To successfully receive a business loan, the entrepreneur must have demonstrated the ability and willingness to pay back loans and meet financial obligations.  Having solid personal finances with a high income to debt ratio and positive net worth is equally important.  Most lenders require a FICO score of 680 or better.

Business Plan - A good business plan demonstrates a thoughtful study of the business, the risks the competition, and the finances.  Time invested in a good business plan will not only help in securing financing but will greatly improve the chances for success.

Collateral - When financing a new start-up business, the entrepreneur must be able to offer some collateral to secure a least a substantial portion of the loan.

Experience - A lender will want to know that an entrepreneur has significant industry experience and/or experience managing a business.

Cash Flow- The financial projections must be based on sound information and show that within a reasonable time the business can generate sufficent cash flow to keep entrepreneur in business and repay the loan.   

Personal Investment - The entrepreneur must be able to put up at least 20% of the total start up costs to secure a loan.  A larger personal investment improves the changes of getting financing.