At the same time, applying for a small business loan can be exciting and painful. Be prepared for the best results and to increase your confidence, be prepared when you visit the lender you have selected for your business loan interview. After you have prepared your business plan, start preparing the loan by writing a loan proposal to present to the lender.
The loan proposal would like to provide some important information about both you and your business or business idea, and many more details. It should state who you are, how much money you need and where it will be spent, how you intend to repay the loan, and what you intend to do in the meantime. Can’t repay the loan.
Here are the key elements to include in your loan proposal.
This should be listed first in your proposal, but will be written last. It should include clear, concise, accurate, inviting information about your business or your business ideas. It should outline how the proposed loan will be used, how it will be repaid, and how it will benefit your business. Remember your competitor in your loan proposal summary, and identify the characteristics of your business that are different from your competitor’s.
2. Management profiles.
The loan proposal management profile section should explain who you are most important to. Be prepared to reveal everything about yourself and your experience. Include existing resume Z as part of the loan proposal, as well as your skills, qualifications and other credentials for yourself, as well as for all other owners and key members of your management team.
It is not necessary to include the same information in your business plan as in your loan proposal. However, you need to provide a solid description of the business. Include a brief business history in your loan proposal, and a description of current activities. If this is a new business, provide details of the business that will be ready. Your goal is to make it clear that you fully understand your markets, your competitors, and the industry, including current trends or risks, and how you plan to overcome these potential dilemmas. If the loan is for an existing business, include in the literature a description of your product or service, such as an existing sales sheet, brochures, or catalog. Include attachments to your own loan proposal for this section, such as letters from suppliers, customers, or other business references. Demonstrate through these letters that you provide excellent customer service, and that you repay your creditors.
Make statements of estimated income and cash flow for at least two years. Your estimates should be clearly stated and most importantly realistic in nature. Generally, you may not need to present a “worst case” or “best case” scenario unless the lender asks you to write an estimate. However, you should be prepared to answer questions about what you would do if some of your estimates did not work out as planned. For example, if you expect to get a big, new deal or customer based on improvements from a business loan, and that deal never happens, it will speed up your loan proposal estimates. Can make a difference
Your loan proposal should include both business and personal financial statements. Be aware that the lender will do a thorough analysis of the history of your financial statements, calculating the entire ratio. Be prepared to point out any key trends outlined in your introductory paragraph.
6. Purpose of the loan.
One of the most important part of your loan proposal is the details of how you will use the loan amount. You need to understand the nature of the loan in question, and remember to include the loan amount in your cash flow estimate, as well as be interested in stating your expected income.
7. Payment plans
Repayment plans should also be mentioned in your financial estimate section of the loan proposal, but details of repayment plans should be separate. Suggest the terms of your choice, and prepare to negotiate with the financial institution. The lender will consider a number of factors as they assess your overall risk of lending. Understandably, this will affect the terms of return they offer to your business.
Especially if your credit is good, and even if your credit is not so good, remember that in your loan proposal, you are offering the bank a deal that will give them money. ۔ Don’t go for less that your full potential. Instead, schedule an interview with the purpose of your loan proposal in mind. That is, focusing on how much money you will need, and thinking about going to a meeting to figure out how much they are willing to lend. Never go to a meeting asking for a loan, wondering if they will lend you one. If this first lender does not approve your loan proposal, trust that there will be a different will.