Bank Loan Success

Banks are in the business of lending. They like to lend. It’s where they make their money. But they have a responsibility to be 'safe' with their lending. Therefore good lending applications are ordinarily welcome at most mainstream financial institutions. Your job is to outline how your application is a 'good risk' for the bank.

Your job is to “streamline” the process of having your application approved, in other words - do the preparation and make it easier for the bank to say yes!

So how do you do this? The principles of a strong loan application are quite straight forward.

1. You understand what the bank needs and expects

2. You prepare

3. You make a professional application

1. The Banks Perspective & Expectations

Look at things from the bankers’ perspective; put yourself in his or her shoes. Be realistic. Would you lend to your business? The bank official cannot approve what could appear to be a bad or risky loan! The bank is a business, it needs to be profitable.

Discuss the logic for your business loan with a business colleague or friend. Ask them to honestly appraise whether your proposal makes sense from their perspective? Ask them if they believe in your vision for the business venture or expansion. Does it appear to be feasible and viable.

If you can’t convince yourself or a worldly wise friend, well then you are unlikely to convince a trained and experienced bank lending official.

2. Your Own Personal Preparation

Prior to your meeting with a lending official, you should have all formal and preliminary application documentation completed, have it proof read and double checked by somebody capable. This usually involves having a business plan and application form completed.

Anticipate any additional documentation you may need, for example; tax clearance certificates, cash flow statements, audited accounts for previous years, and any other documents.

Consider all the questions that you may be asked by the bank manager and have your response articulated.

You could go a step further in your preparation and actually Test your proposal. You could go to a banker you know, do a mock run, run your application by them, get them to critique it and ultimately see if your application would (in principle) get their approval. If not you can ask why and if possible you can fix it!

3. A Professional Application

The documentation you should have prepared usually consists of;

• A Detailed and Professional Business Plan

• A Neat and Fully Completed Application Forms

• Historic Accounts

• Solid Financial Forecasts

• Trade References

Other Key Factors & Considerations That Impact on Bank Loan Application Success:

• The Person (Or Company) behind The Application

You should be ready to convince the bank lending official of your:

• Your Business’s Growth Potential and Propensity for Success

• Business Capabilities and Competencies

• Your Personal Commercial acumen

Your forecasts and projections should demonstrate:

• An Ability to Repay - Positive Cash-flow

You should also be able to demonstrate:

• A Willingness to Invest Your Own Funds

Help is Available!

Should you require any assistance with the preparation of your business plan, then please don’t hesitate to contact Mark Day at Irish Business Plans at www.irishbusinessplans.com

We have over 10 years’ experience helping entrepreneurs to prepare professional loan applications and business plans and we would be delighted to assist..

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