Things you will need for a business loan
Most business owners find that at some time in the lifecycle of their business they will need to apply for a business loan. Savvy business owners understand that in today's tight lending market how they present themselves can go a long way toward whether or not they will get the business loan. If you are business owner and have taken the time to have the right documentation and have done your research you are far more likely to walk away with the business loan that you want. Taking the time to make sure that your business plan is stellar before ever meeting with a loan officer will also help to increase your chances of obtaining the loan that you want. Here are the things you will need for a business loan-
- Start with your credit reports-The first thing that you should do is to pull both your personal and business credit report. Do not make the mistake of not pulling your personal credit report because your lender will most likely do so. You will want to take the time to go over both credit reports in-depth and make sure that all of the information is accurate and up to date. If you find mistakes it can take time to fix them so it is imperative to do this long before you will be applying for a business loan. The bottom line is that you want to make sure that your credit reports are absolutely stellar long before you get to the bank.
- Show how you will repay the loan-The number one thing that your lender will be the most interested in is how you will repay the business loan. You will need to make sure that you can show that you have a history of positive cash flow. If your lender doubts your ability to repay the loan there is very little chance that you will get it. If you are seeking start up financing you will need to be able to show that you have had financial success in the past. This can be done by showing records from a previously owned business. The more you can inspire confidence in your lender the greater the chances that you will able to walk away with the loan that you want.
- Have a great business plan-Vague guesses and predictions will not inspire the confidence you will need. Your lender will want to see that you have taken the time to write down a plan that will help you make your business successful. Your business plan will need to be a roadmap of not only what you will do with the money that you are borrowing but how you will repay it. Your lender will be looking to see if you have a realistic business strategy and goals for your business. In addition, if you are seeking lending for an existing business your business plan it should include detailed financial records that show the state of your business finances.
- Show them that you are the right person-Lenders understand that they are not really investing in the products or services of any particular business but rather in the people who run the business. You want to show your prospective lender that you and any other management are the right people to run your business. You should include in your business plan any prior achievements that are related to your business, how you increased growth, and how you went about expanding your client base. All of these show the lender that you have a realistic grasp on what it will take to make your business a success.