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Is the free ride over? Preparation for a bank loan

Have you ever applied for a loan? It’s daunting to me but must be done. I’ve done much of what I can and want to make a leap forward. Take it to the next level. As a matter of fact I feel I’m dragging my feet now. So here I go.

I should have had these things in order long ago. But it’s been pretty much start and go. I have a little more than tweaking to accomplish. And my meeting is merely hours away.

They say the funding is available. You just need to know how to present your case correctly. Being tarde has already spoken volumes to me. I made a discovery on my credit report that wasn’t there before. No time now to get that straightened out. I reported it but it would have helped to work on it a bit.

So on with my research and discoveries. The experts say:

‘The most common reasons for applying for a business loan include:

Buy real estate.
Get more building space.
Buy equipment.
Invest in inventory.
Get needed working capital
Launching of a new product.
What You’ll Need

Bank loans typically require extensive paperwork. Check with your accountant to make sure all your business financial reports are ready for the loan officer’s review.

At the least, a small business applying for a loan will likely need:

Your personal credit history and credit score.
The credit history for your business.
Both personal and business financial statements. This includes your debt-to-income ratio.
Business plan, which includes biographies of the principals, their education and experience in the field. Provide information such as how long you’ve been in business and the current state of the industry and growth rate. Projections for cash flow for the coming year.
Guarantees from the principals.
Industry risk as rated by governmental SIC codes.
You should accompany these documents with the story of your business, as a way to tie it all together, and present your best possible profile to the loan officer. Talk about industry growth, your chance to partner with a major player in the field, or other reasons you are seeking the loan.

The loan application package, which will also include all the required paperwork, should be filled out. If you have questions, ask the loan officer. Don’t turn it in only partially completed.

What Lenders are Looking For

Your firm needs to be on solid financial ground in order to qualify for a bank loan. In a best case scenario, that means you should be able to show your business has been profitable for the last three years.

Primarily, there are three criteria you need to meet.

The purpose of the loan must be financially sound. That means using it for speculating, for lending, for investments that are passive in nature or for pyramid sales are out of bounds.
Have a good credit history. The principles, including you and the key members of your management team, must have good credit, personal or business, and be experienced in the field.
Proof you can pay the loan back. Your business or you personally must have the assets to back the loan up. In many cases, you will be asked to guarantee the loan personally. As long as your firm has ample assets, they probably won’t ask for a lien on your home.
The loan department will examine all the paperwork in detail. Don’t be surprised if they even check your social media for clues about the state of your business. Bank loan departments are thorough.

In summary, do your research, prepare well in advance of the loan and completely fill out all the paperwork. Present your business in the best possible way, while staying accurate. The loans are available, and if you prepare adequately, you have an excellent chance of getting what you need.

© Fintactix, LLC 2016’

Note:

For those who have a little business history and not mentioned in the above;

Past business tax returns and accountant prepared financial statements if your business is already operational Business licenses and registrations
Articles of Incorporation
Copies of contracts with any third parties
Franchise agreements
Copy of your credit report and your credit rating to review yourself prior to the meeting Tweak Your Business Plan

The Small Business Administration (SBA) has produced streams of new and updated loan programs (http://www.sba.gov/category/navigation-structure/loans-grants/small-business-loans/sba-loan-programs/7a-loan-program)since the passing of the American Recovery and Reinvestment Act (ARRA), providing abundant opportunities for entrepreneurs and small companies to get the funding they need to make their business dreams a reality.

Gerri Lewis-Yip,
CEO & Fndr
GerrabbitEmpowered
http://Gerrabbitcashempowered.info
2100 N 49th St
Philadelphia PA 19131
1-267-396-3179. SMS

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