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.

In The News:

---

Washington Post
UAW strike would kill auto loans
Detroit Free Press, United States - 5 hours ago
The US Treasury Department could declare General Motors Corp. and Chrysler LLC in default of their $17.4 billion in loans and demand the money back, ...
GM's $13.4 billion federal loan deal bars strikes The Associated Press
UAW strike would put automakers in default of federal loans DetNews.com
GM, Chrysler's federal loan deals bar strikes The Associated Press
Detroit Free Press - DetNews.comall 665 news articles

WSAV-TV
Consumer Borrowing in US Falls Record $7.9 Billion
Bloomberg - 16 hours ago
Non-revolving debt, including auto loans, dropped $5.2 billion for the month. Fed policy makers last month cut the benchmark interest rate target to as low ...
Consumer borrowing falls by $7.94B in November The Associated Press
Consumers borrow less than expected CNNMoney.com
Consumer Borrowing Plummets 3.7 Percent In November AHN
Forbes - CreditCards.comall 219 news articles

AFP
Citigroup, Senators Agree on Bankruptcy Role to Trim Loan Rates
Bloomberg - 7 hours ago
The revised bill Citigroup endorsed would give judges the ability to adjust principle payments or interest rates on existing loans, and could extend the ...
Citi Reaches Deal With Lawmakers on Home Loans New York Times
Citi reaches deal with lawmakers on home loans The Associated Press
Citi Will Support Bill to Rework Bad Loans TheStreet.com
AFP - Wall Street Journalall 575 news articles

Javno.hr
Loan Delinquencies Hit Record High Last Year
Washington Post, United States - Jan 7, 2009
By Nancy Trejos Delinquencies on auto loans and home equity lines of credit reached their highest levels on record during the third quarter of 2008, ...
Late loan payments hit record high in Q3 USA Today
US consumer loan late payments at 28-year high Reuters
Home-equity delinquencies at record level Newsday
Minneapolis Star Tribune - WalletPopall 63 news articles

Sallie Mae Raises $1.5 Billion for Private Loans
Washington Post, United States - 15 hours ago
Reston-based Sallie Mae has secured $1.5 billion worth of financing from investment bank Goldman Sachs for a batch of private student loans, a sign that ...
Sallie Mae shares falter despite financing BusinessWeek
Lump of Coal from Sallie Mae AACRAO Transcript
Sallie Mae Closes $1.5 Billion Financing WELT ONLINE
MarketWatch - RTT Newsall 25 news articles

PennyMac, Led by Ex-Countrywide Head, Buys FDIC Loans
Bloomberg - Jan 7, 2009
Known as PennyMac and led by Stanford Kurland, the firm is paying an average of 30 cents to 50 cents on the dollar for the loans and the FDIC is sharing ...
FDIC Unnationalizes Some Debt Forbes
BlackRock, Highfields-backed firm to share gains and losses with FDIC MarketWatch
PennyMac Completes Purchase of $558 Million in Mortgage Loans from ... Associated Content
The Associated Press - PR Newswire (press release)all 80 news articles

Reuters
Banks Pare Fed Loans After Increase for Year-End Cash
Bloomberg - 16 hours ago
Outstanding loans to banks through the Term Auction Facility dropped to $384 billion from $450.2 billion, the Fed release showed. ...
Fed Says M1 and M2 Rise, Loans to Banks and CP Loans Fall CEP News
Fed faces tough task ending emergency support MSNBC
Banks borrow more, investment firms less from Fed The Associated Press
Bloombergall 106 news articles

Legislative analyst doubts loans will fly
San Francisco Chronicle,  USA - 5 hours ago
Finding investors in a credit market that's in turmoil and a potential legal challenge on whether the state can take out short-term loans to balance the ...
Report: Schwarzenegger's heavy borrowing proposal is risky San Jose Mercury News
Analyst has worries over Schwarzenegger plan to close budget gap San Francisco Chronicle
all 26 news articles

The Money Times
Lyondell Can Borrow $2 Billion in Largest US Loan
Bloomberg - Jan 7, 2009
US Bankruptcy Judge Robert Gerber in Manhattan approved the loan at half-past midnight, after lenders spent five hours negotiating to resolve objections to ...
Judge OKs LyondellBasell loans after Ch. 11 filing Forbes
Bankruptcy loans approved for LyondellBasell Chemistry World
Lyondell gets over $2 bln in bankruptcy financing guardian.co.uk
Financial Times - Reutersall 429 news articles

NBC4i.com
SBA Disaster Loans available in Indiana
Warrick Publishing, IN - 4 hours ago
The US Small Business Administration announced recently that federal economic injury disaster loans are available to small businesses, small agricultural ...
SBA Loans (Still) Plunging Inc.com
Group: Small Business Owners Aren’t Getting Loans NBC4i.com
Wells Fargo now leading small business lender in Washington Kitsap Peninsula Business Journal
openPR (press release) - Long Island Business Newsall 25 news articles

loans - Google News

Student Loan Limits Not Keeping Up with Tuition Rates

As tuition rates at many colleges continues to rise, the limits that students may borrow each year has stayed the same.Dependent undergraduates may borrow up to $2,625... Read More

5% Down Vs. 10% Down - A Comparison

It has always been an issue for home buyers to save their down payment. Many people, on advice from various people wait to save 10%, rather than... Read More

Getting the Best Loans UK with Bad Credit

Sometimes it might seem as though finding good loans UK is nearly impossible for those who have bad credit.Having bad credit can make life difficult in many... Read More

To Be Mr. and Mrs. Sometimes You Need Wedding Loans

The conception of wedding has changed over the years. Its conception, its configuration, the way it is planned ? all have changed through the past times. You... Read More

Secured Business Loans ? Equipping Your Business Blueprint With Concrete Groundwork

Somebody once said, 'Business is not financial science; it's about trading, buying and selling. It's about creating a product or service so good that people will pay... Read More

Payday Loans ? The Legal Loan Sharking Industry

Laws have been created to protect people against "Loan Shark" practices in which short-term loans are given out at excessive interest rates. There is an industry that... Read More

Payday Loans or Cash Advance Loans - Useful After a Bankruptcy

Payday loans, also known as cash advance, are a useful tool after bankruptcy. By keeping current on your bills through a payday loan, you can rebuild your... Read More

Cash Advance Payday Loans: A First Time Users Guide

If you considering using a Cash Advance Payday Loan service for the first time, this article addresses the most frequently ask questions.WHAT IS A CASH ADVANCE PAYDAY... Read More

Long Term Unsecured Loan?

In order to understand qualifications for loan approval, let's examine the types of loans; secured and unsecured, and the two types of re-payment plans: short term and... Read More

Online Loans: The Easy Way to Apply

The internet is a great place to find the right lender for obtaining a loan. One can apply online by filling out a simple application and submitting... Read More

Instant Payday Loan and Instant Payday Loans

Instant payday loans are financial loans that are available for anyone who is experiencing an unexpected crisis and is in need of additional cash fast. A lending... Read More

Finding an Auto Loan with Bad Credit

Finding an auto loan online is easy regardless of you credit score. By simply completing a simple one page application hundreds of online lenders who will compete... Read More

Bridging Loans - Fulfilling Financial Shortfall between Real Estate Transactions

You are trying to buy a new property and selling the current one to raise money for the new purchase. It is usually difficult corresponding sale of... Read More

Wedding Loans Because Wedding May Be Made In Heaven But They Are Certainly Not Made For Free

Wedding loans because wedding may be made in heaven but they are certainly not made for free.The one day that encompasses the glamour, the thrill, the dreams,... Read More

Finding the Loan UK that Meets Your Needs

For those in the market for a loan UK , it can sometimes seem like nothing is going your way and all of the offers that you've... Read More

No Money Down Real Estate - Fund All Your Deals With Private Lending!!

If you invest in real estate, you need cash to buy houses. Even if you have a full bank account and great credit, you'll eventually run short... Read More

Fast Cash Personal Loan - No Credit Check and Very Quick

You can get a payday advance with cheap rates and get up to 30 days to repay your loan. A payday advance is an unsecured loan used... Read More

Car Loans for People With Bad Credit

Car loans for people with bad credit are readily available online. After completing an online car loan application, you can expect an approval within a few minutes.... Read More

What is a Home Owner Loan?

A UK Home Owner Loan Can Unlock Your Capital To Use Today.Unlock the value tied up in your property with a great value secured Home Owner loan.... Read More

Military Payday Loans ? When?s The Best Time To Avail Of These?

What are the opportune times to avail of military payday loans? The best time to take out military payday loans are when you find yourself temporarily short... Read More

A Look at Getting a Bad Credit Personal Loan

Trying to get a bad credit personal loan can be frustrating. It may be that you don't know where to turn to find the loan that you're... Read More

Secured Loans Information

A secured loan is a personal loan which is generally offered to home owners. In a typical secured loan, the home is used as collateral against the... Read More

Want a Cheaper Finance for Your Vehicle? Try Secured Automobile Loans

The usual modus operandi in most automobile purchases is as follows:Step 1: Recognize the urge for an automobile.Step 2: Check the bank balances.Step 3: Head for the... Read More

No Credit Car Loans - Even With No Credit History, You Can Still Get Approved

Even it you have no credit history, you can still get approved for a car loan. With a car loan, you can purchase your vehicle and build... Read More

A Brief Look at the Origins of Lending

When trying to discover the origins of lending you might find yourself looking at a lot of unrelated information that doesn't really tell you what it is... Read More

Become A Smarter Borrower

With a nation that has in the region of a Trillion pounds of debt one could say we are serial borrowers. Before you consider borrowing money it... Read More