If you really want that business loan, it’s all about presentation. How well you present yourself, your business, and your financial needs to a lender will determine whether or not your loan request is approved. You can improve your chances by preparing a written proposal before you visit a potential lender.
Your business loan proposal should contain the following:
- The business name and address, names and social security number for each partner.
- A short statement on each partner in your business; provide background, education, experience, skills and accomplishments.
- The purpose of the loan. State exactly what the loan will be used for and why it is needed as well as the exact amount you need to achieve your purpose.
- The history and type of your business. Include the details of your company's legal structure, the number of employees, current business assets, and how long have you been in business.
- Your company's products and/or services, clearly defined, as well as your marketing target. Define how your business will compete in the marketplace. Profile your customers and explain how your business can satisfy their needs.
- Organize all financial statements for the business and those of all partners for the past three years. Include your business balance sheets, income statements, investments, and assets as well as collateral that you would be willing to put up to secure the loan.
When reviewing a loan request, the bank official is primarily concerned about repayment. To help determine the ability to pay, many loan officers will order a copy of the business and personal credit report of each partner from a credit-reporting agency. It may be a good idea to look at your personal and business credit reports before you apply for the loan to make sure credit information is accurate.
At Summit CPA we offer multiple resources to assist you with all your financial needs. If you are in need of further assistance in writing your loan proposal contact our office at (260) 497-9761 to schedule an appointment with our advisors.