Debt Consolidation: How to Manage Small Business Debt
Consolidating debt for your small business may not only help you as a business owner to regain control of your business’ finance, but debt restructuring can also help set your business up for growth and expansion.
Debt is inevitable, especially in small businesses, and in fact financial leverage is key to growth. But small businesses can easily become overwhelmed with various forms of personal and credit card debt, which can ultimately stagnate business growth.
So, while debt is a normal and healthy part of your business, some basic restructuring and consolidation can make your debt more manageable. Debt consolidation involves paying down multiple high interest rate debts (e.g. credit card debt, line of credit or personal loans).
When it comes to debt consolidation, there are many factors and elements to consider prior moving forward. Here are some quick steps you can take to maximize the outcome for your business.
Step 1: Gather facts
Gather all your bill statements, credits, and loans to determine how much debt your business has acquired.
Step 2: Determine debt
List and categorize your debt using tools like Excel or Spreadsheet. Analyze and decide if your debt needs to be paid off immediately or can be put off until later. Key factors to consider when assessing your debt include the interest rate, term and monthly payment.
Step 3: Do your Research: Determine what’s best for your small business
Research and shop around for different options, interest rates, fees, terms, and conditions of plausible debt-consolidation options that best suit your small business.
Opt for companies that specialize in small business lending – companies backed by a team of experts in finance, lending and Canadian small business.
Step 4: Consider Alternative Lending and Online Loans
Debt consolidation needn’t be a lengthy, difficult or time-consuming process – innovation in technology and finance has made it possible apply and get approved for loans instantly online, gaining access to funds as early as the next business day, so you can put your small business debt consolidation plan into effect right away.
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About the Author
Lendified is Canada's premier online lender for small businesses. The company was founded by former bank executives dedicated to provide businesses with fast, easy, and affordable financing. The Lendified team regularly produces blogs and guides to help small business owners succeed.