Ready to apply for a loan to grow your small business? It pays to be prepared before you fill out a single page of paperwork or step foot inside a bank. Insufficient research or information gathering can place needless roadblocks between you and your business goals.

Here are three simple tips to help prepare your small business loan application and maximize your chance for loan approval and favorable interest rates.

1. Make sure your business credit score is in good shape.

Your credit rating (both your personal and business credit scores) has a major impact on interest rates and loan approval. It’s crucial to:

?Know where you stand with the major credit bureaus.

?Check for and dispute any discrepancies or errors on your report.

?In the months leading up to your application, avoid other new loans or credit inquiries (for example, buying or leasing a new vehicle or home).

?Pay all bills on time to avoid damaging your credit score.

?Avoid using a large percentage of available credit card balances.

2. Prepare a business plan.

A thoughtful business plan shows the bank or investors that you have considered and prepared for all potential risks and situations. It also educates lenders on the market need or opportunities in your area, your potential audience, and your long-term growth plans. Doing this legwork can help show the bank you’re a low-risk investment. Crunch the numbers before someone else does to make sure everything adds up.

3. Check your financial statements.

Review your most recent profit-and-loss and cash flow statements, so you know how much you need to borrow and how much you can pay back every month without affecting operations. Financial institutions may be able to help you nail down realistic and specific estimates, but you shouldn’t ask for a loan without first being confident of at least a ballpark figure.

While these documents are fairly standard in the loan process, required documentation varies by lender. Even if your preferred lender has less stringent requirements, these steps will provide you with a clearer understanding of your business model, financial health and the loan application process.