Considering taking out a business loan or establishing a line of credit? You're in good company. Needing to expand, pay for a few large bills, or just have a buffer for slower months, extra cash can provide your business with the space it requires.

But this is the catch: approval means more than just signing on the dotted line. Lenders want to be assured that your business is strong—and that you've done your homework.

From my experience with entrepreneurs, I've learned that a little planning goes a long way. So here's what you need to do in advance of applying.

Know What Lenders Are Concerned About

Most lenders are trying to reach the bottom of one big question: Will this guy be able to repay us—on time and in full?

They will take into account such as your personal and business credit histories. If your score requires some attention, now is the time to give it a little TLC—paying off balances and up-to-date payments can make a huge difference.

They’ll also want to see that your business brings in consistent revenue and manages money well. If your income tends to spike or dip, that’s okay—just be ready to walk them through why and how you’re planning ahead.

If you have outstanding debts, that will be included as well. And depending on the type of loan, you may need to offer collateral—equipment, property, or accounts receivable are common options.

Get Your Financials in Shape

If you've ever scrambled to assemble last-minute documents, then you know it's no fun. Lenders want neat, up-to-date financial statements. We're talking tax returns, profit and loss statements, balance sheets, bank statements—the whole shebang.

The cleaner your books, the better a lender will feel. If accounting isn't your forte, it's entirely worth bringing in someone to get it sorted out prior to applying.

Select the Proper Style of Loan for You

It's not a one-size-fits-all deal when it comes to financing.

If you're buying big or investing, a fixed-payout loan is the ticket. If you prefer to have malleable access to cash anytime—e.g., to match seasonal variations—a line of credit is more likely to be suited.

And if you need improved rates and terms, an SBA-guaranteed loan might be something to look into, although one that might take some time to accomplish.

Even If You Don't Need Funding Now, It's Smart to Be Ready

One thing I always recommend: don't wait to get yourself into trouble before you begin preparing. Getting good habits early—like keeping an eye on cash flow, staying current on expenses, and keeping your credit in good shape—all this can help ease the way later when you finally do decide to apply.

If you're even thinking about borrowing cash or tapping into a line of credit, I'd be happy to walk your numbers by you and talk through what would work best for you.

You don't necessarily have to spend it—but it's nice to know that it's there if you need it.