How To Apply For a Business Loan

Worried about how to apply for a business loan? Although it may seem like a daunting task at first, it can be made less so by careful preparation. When applying for a business loan, you must prepare a written loan proposal. Make your best presentation in the initial business loan proposal and application; you may not get a second opportunity.

Always begin your proposal with a covering letter. Clearly and briefly explain who you are, your business background, nature of your business, the amount and purpose of your loan request, your requested terms of repayment, how the funds will benefit your business, and how you will repay the business loan. Keep this cover page simple and direct.

When writing your proposal, don't assume the reader is familiar with your industry or your individual business. Always include industry-specific details so your reader can understand how your particular business is run and what industry trends affect it.

Provide a written description of your business, including the following information:

Type of organization, Date of information, Location, Product or service, Brief history, Proposed Future Operation, Competition, customers, Suppliers

Management Experience: Resumes of each owner and key management members.

Loan Repayment: Provide a brief written statement indicating how the loan will be repaid, including repayment sources and time requirements. Cash-flow schedules, budgets, and other appropriate information should support this statement.

Existing Business: Provide financial statements for at least the last three years, plus a current dated statement (no older than 90 days) including balance sheets, profit & loss statements, and a reconciliation of net worth. Aging of accounts payable and accounts receivables should be included.

Proposed Business: Provide a pro-forma balance sheet reflecting sources and uses of both equity and borrowed funds.

Projections: Provide a projection of future operations for at least one year or until positive cash flow can be shown. Include earnings, expenses, and reasoning for these estimates. The projections should be in profit & loss format. Explain assumptions used if different from trend or industry standards and support your projected figures with clear, documented explanations.

Collateral: Provide a list assets to be held as collateral. Few financial institutions will provide non-collateral based business loans. All business loans should have at least two identifiable sources of repayment. The first source is ordinarily cash flow generated from profitable operations of the business. The second source is usually collateral pledged to secure the business loan.

Depending on your particular circumstance you may need to provide one or more of the following documents:

Lease, Franchise Agreement, Purchase Agreement, Letters of Intent, Articles of Incorporation, Plans, Copies of Licenses, Letters of Reference, Contracts or Partnership Agreement.

You may freely reprint this article provided the author's biography remains intact:

John Mussi is the founder of Direct Online Loans who help UK homeowners find the best available loans via the http://www.directonlineloans.co.uk website.

---

Secured Business Loans ? Equipping Your Business Blueprint With Concrete Groundwork

Somebody once said, 'Business is not financial science; it's about... Read More

6 Key Points to Evaluate Online Lenders

The internet is teeming with lenders who are vying for... Read More

Filling Out The Loan Application

1. Property information. The application begins with a section on... Read More

Quick Cash Advance Payday Loan - Get it Free or Cheap

If you are looking at getting a payday loan or... Read More

Long Term Unsecured Loan?

In order to understand qualifications for loan approval, let's examine... Read More

Be Wary of Guaranteeing a Loan

You need to be wary of guaranteeing a loan. What... Read More

What is an Auto Loan?

An Auto loan is basically another name for a car... Read More

About Personal Loans

What are personal loans? They are unsecured loans that a... Read More

Should You Ever Take a Payday Loan?

Payday loans have many names -- cash advances, signature loans... Read More

What is the Difference Between an Unsecured Personal Loan and a Secured Personal Loan?

This is a common question that many consumers have. Many... Read More

Education Loans Can Augment The Boundaries Of What You Can Achieve

Education never ends ? it is not said without reason.... Read More

Government Loans for Beginners

Government loans are those that the government of a country... Read More

What Are VA Loans?

VA loans are basically mortgages or home loans geared towards... Read More

Personal Loans for Bad Credit Can Discipline Repercussions of Negative Credit

Bad credit is like an ongoing battle for many loan... Read More

All About Bad Credit Secured Loans

Bad credit secured loans are a relatively recent addition to... Read More

A Guide to Finding an Adverse Credit Homeowner Loan

If you're searching for an adverse credit homeowner loan, you... Read More

Used Car Loans - 3 Tips For Financing Your Used Vehicle Online

Financing the purchase of a used vehicle can be done... Read More

Poor Credit Car Loan - Get Approved Online

Poor credit doesn't have to stop you from getting a... Read More

Secured Loans Tips

Here are some useful secured loans tips. Secured loans enable... Read More

What is a Secured Loan?

A secured loan is simply a loan that uses your... Read More

Shopping for Loans Online

When looking for loans online, you might find yourself wondering... Read More

Car Loans After Bankruptcy - How Poor Credit or a Recent Bankruptcy Can Affect Your Loan Approval

If you have poor credit or a recent bankruptcy, you... Read More

Secured Loans ? Filling the Void Created by the Deficiency of Resources

"Money is like a sixth sense without which you cannot... Read More

Benefits of a Home Improvement Loan

Some of the many benefits of a Home Improvement Loan... Read More

A Brief Look At Various Types of Loans Available

A Brief Look At Loans "Innovative financial packaging" is how... Read More

Bad is the Opposite of Good... Is It? Not with Bad Debt Personal Loans

'Bad' means 'bad' no matter where you go! It is... Read More

Bad Credit Car Loans - Why They Are Easier To Get Than They Ever Have Been

Car loans are easier to get by using an online... Read More

How to Find a Good UK Secured Homeowner Loan

If you're looking for a UK secured homeowner loan, you... Read More

Signature Loans: A Signature Can Relieve Stress Of No Collateral And Bad Credit

The dynamics of loans borrowing procedure has brought new ways... Read More

Why Choose an Unsecured Loan?

Why choose an unsecured loan? An unsecured loan can be... Read More

What?s All the Hype about Omni Military Loans?

The average person some time in their adult lives will... Read More

Secured Personal Loans: Constructive Structuring for Financial Success

Credit relationships in a social system form an intricate web... Read More

Should You Get A Pay Day Loan?

Whether you have good credit, bad credit or no credit,... Read More