Get the Tata Capital App to apply for Loans & manage your account. Download Now

Blogs SUPPORT
Loans For You
Loans for Business
Investment
Insurance
Apply

Quick Links for loans

Quick Links for Insurance

Investment

Offers Quick Pay
Back

Equipment Finance

Avail Digital Equipment Loans
up to Rs. 1 Crore

  • Attractive ROIs
  • Customizable Loan tenure
Know More
Back

Equipment Leasing

Avail Leasing solutions
for all asset classes

  • Up to 100% financing
  • No additional collateral required
Know More
Back

New Commercial Vehicle Financing

  • First time user
  • Retail and strategic Clients
Know More
Back

Used Commercial Vehicle finance

  • Repurchase
  • Refinance
  • Top up
  • Balance Transfer
Know More
Menu  
 
Apply Now

Tata Capital > Blog > Loan for Business > Common Mistakes Business Owners Make While Availing A Business Loan

Loan for Business

Common Mistakes Business Owners Make While Availing A Business Loan

Common Mistakes Business Owners Make While Availing A Business Loan

Under-capitalization or cash-strapped business can make a business’ future look bleak- and could also become one of the main reasons of a business failure. Entrepreneurs can make the best out of these worst situations by resorting to Business Loans. In most cases, you’ll need to borrow to get the necessary funds for your purchase or expansion. If you are rushing to sign on the dotted line of a business loan, do read the common mistakes business owners make while doing so. We promise you won’t regret after reading this.

Know More

1. ‘I didn’t read and understand the terms carefully before signing’

Not reading the business loan terms carefully before signing is a big mistake. The terms and conditions, also called TnC, tells you what is expected of you as a borrower. It will contain details about all fines, penalties, etc. Often TnC are quiet voluminous and boring. In your haste to get a loan, you may commit to things that can cost you a fortune. So, don’t jump the gun and sign papers without reading the details and terms of the loan. Ask questions about things you do not understand.

2. ‘I am applying for multiple loans simultaneously’

Some business loan seekers make a mistake of applying for multiple business loans at the same time. They seem to think that multiple applications can boost their chances of getting at least one loan. The actual effect of applying for multiple business loans is not at all prudent. Lenders interpret this kind of behavior as the borrower being credit-hungry and your precious credit score gets a hit. Simple eligibility and documentation make business loans quite convenient.

3. ‘I waited for the cheapest loan offer and so let go of the best one’

Everybody wants to pay the cheapest EMI. But, cheap is not necessarily the best for you. More often than not, falling into the ‘low EMI’ trap, could lead to situations where you get a cheap business loan, but the servicing may be awful. You should consider the entire process, servicing, track-record, and other factors before selecting the lending institution. Tata Capital is always there to meet your collateral-free personalized business loan requirements at competitive rates without bothering you with too many formalities.

4. ‘I did not take the right business loan, right EMI product’

The saying “One size does not fit all” goes very well when choosing for a Business Loan. There are different types of business loans for different needs. If you take a Business Loan that is not the best fit, it can be problematic. A term loan is not as same as a working capital loan. Term business loans can be of tenure for 3 to 15 years, while a working capital loan is for meeting your daily business needs. Similarly, taking the right EMI product is very important. You may want to pay EMI amounts in a particular way, but if you are not careful you may have taken a standard EMI option. For instance, Tata Capital gives you the option and convenience to customize your monthly business loan repayment instalment (flexi EMI or structured EMI). So, the EMIs you pay are best-suited for your company’s cash flow situation.

Yes, you need a business loan on an immediate basis. However, taking a little time to do your due diligence can help you avoid in making some of the most over-sighted and common mistakes while availing a business loan.

Apply Now

Give Your Business the Right Boost: Apply for a Business Loan Today

Apply now
Popular Searches
business idea udyogini scheme hsn code full form low investment business ideas top 10 most successful businesses to start transport business import export business in india mineral water plant cost collateral free loans
Disclaimer

Most Viewed Blogs

Trending Blogs

Calculator

Personal Loan EMI Calculator

Personal Loan EMI Calculator
Home Loan EMI Calculator

Home Loan EMI Calculator
Business Loan EMI Calculator

Business Loan EMI Calculator
Used Car Loan EMI Calculator

Used Car Loan EMI Calculator
Two Wheeler Loan EMI Calculator

Two Wheeler Loan EMI Calculator
Loan Against Securities Calculator

Loan Against Securities Calculator
Loan Against Property Calculator

Loan Against Property Calculator
More Tools
Our Subsidiaries
Our Other Websites

Useful Links and Resources

Most Important Terms & Conditions - Home Loans

Download in your preferred language

Download

Policies, Codes & Other Documents

Most Important Terms & Conditions - Home Loans

Download in your preferred language

Download

Tata Capital Solutions & Services

Uh oh, something went wrong

Please try again later.