Step 1: Define Your Use Case
Match the funding type to the use:
- Inventory or short-term cash → Working capital / MCA
- Equipment purchase → Equipment financing
- Ongoing unpredictable cash → Line of credit
- Real estate → Commercial real estate loan
- Lowest rate, time to wait → SBA 7(a)
Step 2: Decide on Speed vs Rate
Faster funding always costs more. Decide which trade-off you'll accept before talking to lenders. If you can wait 90 days, SBA wins on rate. If you need money in 24 hours, working capital wins on speed.
Step 3: Filter for Direct Lender vs Broker
Direct lenders fund from their own capital and quote you their own terms. Brokers shop your application to multiple lenders and earn commission baked into your cost. Both are legitimate — direct is faster and more transparent.
Step 4: Demand Total Dollar Cost Upfront
Reject any lender refusing to disclose total dollar cost. Calculate: (total amount you'll repay) − (amount funded) = total cost of capital. Don't compare factor rates or weekly payments — they obscure the math.
Step 5: Verify Reputation
Check Better Business Bureau profile, search the company name plus 'complaint', confirm physical address and active website. A real lender has a real phone number and a real office.
Step 6: Spot Red Flags
- Upfront fees collected before approval
- Pressure to sign same-day with no review time
- Unwillingness to put quoted terms in writing
- Brokers who won't disclose how they're paid
- Reviews mentioning surprise fees or aggressive collections
Step 7: Apply to ONE at a Time
Sequential applications, not stacked. Stacked applications create soft inquiries other underwriters can see and signal desperation.