by Amy Taylor

Created on: January 16, 2009

It is getting harder and harder to find financing in today's economy, especially for small businesses. Yet small business success is exactly what our economy needs right now.

Here is a plan for financing your business even when the bank says "no." The number one reason why banks deny credit applications is due to a low credit score. If you tackle this issue first it may make a second loan request at the bank more viable.

1. Get Your Credit Report. Most small businesses do not have a credit history of their own so banks will use the owner(s) personal credit score in determining the credit worthiness of a loan application. Everyone is entitled to one free copy of your credit report annually which can be found at annualcreditreport.com. Or if you have been denied credit from a lending institution you may request a free copy of your credit report directly from the credit bureau. (TransUnion, Equifax, or Experian

2. Check Your Credit Report for Errors. Pay special attention to the name particularly if there is another member of your family with the same or similar name. Ex. John Doe, Sr. and John Doe, Jr. or Mary A. Smith and Mary C. Smith. If there are accounts that are listed incorrectly dispute them. Do not simply dispute every account on your credit report. C'mon peoplewe all make mistakes, it's always best just to own up to them and fix them to the best of our ability.

3. Create a Credit Repair Plan. For collection accounts on your credit report, pay off as many as you can, a paid collection always looks better than an unpaid collection. For larger accounts that can't be simply paid off, call the creditor to arrange a payment schedule or see if you can negotiate the total down to a lesser amount. For outstanding items that are not past due, create a debt reduction plan that will lower your total outstanding debt and your outstanding balance-to-credit limit ratio. There are a million and one debt reduction plans out there (i.e. pay off highest interest rate first, pay off smallest balance first, etc.) It doesn't really matter which one you pick. Think of this as a financial "diet"pick a plan that makes the most sense to you and stick with it.

4. Seek Alternative Lending Sources. Contact your local chamber of commerce, state Department of Economic Development or look for an SBA Microloan Agency in your area. Many of these agencies have loan programs that are earmarked specifically for small business owners. For example, the SBA Microloan program was set up to help

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