business loans tips
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Wanting the business to grow is a natural thing. But sometimes to grow bigger you will need to apply for a business loan. When you, finally, decide to apply for one, you will need to know what lenders are looking for and what you will need to provide.

You need to put together certain things, to have the right combination of facts and figures that will help “selling” you to the lender on the short and long-term potential of lending money to your very own business. Your application has to convince the lender that, as promised you will pay back and your brilliant managerial abilities will result in a great profit-making partnership. The small business loans online lender needs the evidence of security and stability. It is as simple as that.

Business Loan Applications

They have to be realistic, but optimist as well. Let’s say you predict an increase in sales from 9% to 13%. OK, but base your income projections on an increase of 10%, and then clarify what you are going to do to get this additional sale.

Plus, do not forget that the application has to be complete. If one piece of it is missing,  business financing lenders will suspect something. He might think that something is being hidden on purpose. However, to help you out, Personal Money Service has prepared 12 items that have to be present on every loan application.

  1. Cover Sheet. It is sort of a title page for the application. It has to say “ Loan application submitted by Mary Johns, Funny Cupcakes, to Personal Money Service, California.” Include the date and the telephone number of your business.
  2. Cover Letter. It is a personal business letter where you request consideration of your loan application from the lender. Describe your business in the second paragraph. The third paragraph keeps on 1-2 sentences. It will indicate future plans for your business.
  3. Table of Contents. This page has a list of all documentation that you have.
  4. The amount and use of the loan. Here you will specify how much you would like to borrow and how you are going to manage this money.
  5. Brief History and Description of Your Business. This part is more complicated as you need to stay with simple facts assuming that the reader knows not a thing about your business. Tell why you think that this business will succeed. The conclusion paragraph has to be about your future plans. For instance, you can say that you are planning to start an online business soon (Learn how to make money at home as well).
  6. Management Team. OK, this part is extremely important. List every member of your management team along with their responsibilities. Sometimes you can even describe a background of a few people to underline why they are a perfect choice.
  7. Market Data. Start the pages with a full description of your product/product line or services, and which market it is directed toward. Then, describe how you have targeted this exact market niche and how successful you have been so far. At last, detail your future plans to add new products/services.

    payday loans market
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  8. Financial History. If you have it, bring balance sheets, profits and loss statements. For a startup use projections, so that they could compare it to the norms of your market niche.
  9. Financial Projections. There are 3 documents: projected income statement, balance sheet, and, of course, cash-flow statement. Using these three documents you need to show how the business using the loan will generate enough profits to pay off this loan.
  10. Collateral. List all your available collateral.
  11. Personal Financial Statement. Have your tax return and sheets showing the personal net worth ready. Ask your lender if he has a preprinted from. It will make putting these numbers together easier.
  12. Additional Documents. Include all the documents you feel may help your application to get approved.

Now you have everything you need to apply for our business loans. Good luck!