Imagine...staying one step ahead of your customers
Getting a loan may position your company for growth. However, lending institutions are generally more selective about who they lend to than they were a few years ago. So how do you convince lenders that your company is worthy of a business loan? Follow these tips to improve the likelihood that your loan will be approved.
Be sure you have organized your finances and come prepared with documentation. To qualify for a loan; a business must provide evidence that it has the ability to pay back the loan, and can provide sufficient collateral to secure financing. Therefore, at a minimum the lender will need to review the company’s most recent financial statement and its last two years of tax returns. In addition, it is important that your personal finances are in order, so check your credit score and take care of any red flags before applying for a loan.
Write a business plan. Your business plan should include an overview of your business, projected financial statements, as well as a plan for repayment of borrowed funds. Your plan should also include résumés for the owners of the company and an assessment of competitor businesses. Show how your business plans to distinguish itself from the competition.
Tell your company’s story. You need to make a case for why your company needs the money. Simply highlighting past successes does not necessarily explain why your company is looking for a loan. Is there a new partnership you’re looking to pursue? Has there been growth in an area of your industry that the loan will help with? Be specific about what makes now the right time to seek financing. When you’re ready to apply for a business loan, contact Horizon Bank at 888-873-2640 to set up an appointment or visit a Horizon Bank branch near you. Our Business bankers take pride in helping local businesses, and will put the time and effort to truly understand your business and its needs.
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