Fundera Ledger How To Prepare For Your Small Business Loan Application

Inevitably, the underwriting process will generate questions, and the bank will request clarification or additional documents. Provide them as fast as possible so you dont delay your loan approval or cause the bank to reconsider. By knowing what a lender wants, getting your documents in order and providing them quickly, youll improve your chances of getting that much-needed business loan. So what documents do you need? Documents Needed Although the documents youll need to submit will vary slightly depending on the type or size of the loan youre seeking, and your length of time in business, in general most lenders will want to see the following documents. Personal Information This includes any prior names you have used, your previous addresses and your educational backgroundsimilar to what youd provide on a job application. You may also need to provide a resume that explains your work experience. [For] startup entrepreneurs with no entrepreneurial experience, lenders will want to see proof of strong managerial responsibilities and experiencepreferably with a small business, despite not having been the owner, explains Seelinger. Your Business Plan Youll need a business plan when applying for a loan of $150,000 or more, says Seelinger, who is currently Chair of SCOREs Client Finance Committee and spent 32 years in commercial banking. For a smaller small business loan , a business plan may not be requiredalthough the submission of one conveys seriousness and would be a plus, Seelinger adds. The business plan includes: An executive summary A market analysis that explains the opportunity and the competition A description of your business (what it does and what differentiates it from competitors) Information about the companys operations and management, including the management teams experience Your marketing and sales strategy The purpose of the loan Detailed financial projections and financial statements, including a profit and loss statement, cash flow statement and balance sheet. Your Personal Credit Report Before applying for a business loan, get a copy of your credit report from each of the three major credit rating agencies (Equifax, Experian and TransUnion).
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