Sba And Startup Loan Applications - How To Prepare And Proceed
One of the type of calls I get so much in this economy is how do I find financing for my startup business
? In the recent past, SBA lenders like me did so many SBA loans with little or no collateral, with little experience relevant to the deal and in all kinds of industries. Now, however, banks and the SBA want more specific experience, they want more collateral, and certain industries, such as food/restaurant and hotels are difficult.
To start a business, simply you need to find some dough to get your new business off the ground, right? Sounds easy. A good place to start still is the Small Business Administration and your SBA lender. The SBA has programs for which many first time borrowers/entrepreneurs could qualify.
Business loan application
Applications vary a little from bank to bank but they all have basic information in common. Here are some universal questions:
* Resume-What is your personal background? Clarify in detail your experience, resume and specifically show how your background relates to the new business. If you're opening a restaurant, you or a partner must have a background as an assistant or full time restaurant manager. Correlate what you need for the new business to each quality needed for the business.
* Loan Request-Why are you applying for capital?
* Business Plan - Who will be managing the business? Explain your business and how it will work? Explain the market, demographics, profit, marketing, strengths, weaknesses, Do you have a list of suppliers?
* Financials/Projections- You must prepare financial projections in a professional format. Financial statements will be the only way for the bank to judge how you feel the grow over time. You should have, cash flow, income, profit and loss, and balance statements. Add in seasonal adjustments/business cycles.
* Sources/Uses Loan Proceeds -What will you use the funds for? What assets do you need to purchase?
* Personal Financial Statement - Collateral? How much collateral do you have in your home? Investments? Other? Many lenders want at least 50% of the loan amount to be collateralized.
* Tax returns, SBA lenders want to see 3 months worth of bank statements and 3 years of tax returns.
* Personal History and Credit? Bankruptcy? Criminal background? They will examine your personal credit . Typically you need over a 650 FICO score with most lenders. Know first what your credit score says before they pull the credit report. Be ready.
The biggest challenge facing the economy today is how to get SBA funding for financing a small business. An SBA Loan or Microloans is where the owner can receive funds to keep his or her operation going. The environment today has seen many banks that funded SBA Loans go under. We can solve that by educating potential borrowers about the Small Business Administration and the different programs available.
I often suggest that people start using an accounting program from day one and get their financial paperwork in order. This may seem like a no-brainier, however, spend a few bucks and buy an accounting software program. This will allow you to revise your ledgers with a click of the mouse. Many programs have the financial statement already built into the software.
Keep updating, improving, and adding to your business plan. If you don't have a business plan, now is the time to get one. Update it at every month, or more if you can find the time.
Here is a checklist for most loans (at least to start):
Federal Income Tax for previous 3 years
Personal Financial Statement
Cash flow projections for one year
Resume of all owners
Copy of business lease
3 years business Federal Income Tax returns
Profit and loss statements
Certificate of Doing Business
Accounts receivable aging
History of business
How The SBA loan can help
Loan application
Statement of Personal History
Types of SBA loans:
SBA Microloans
Smaller loan amounts that can used for many thing
SBA 504 Loan
How it works to help the owners and create job
SBA 7a Loan
Most popular Loans program. Capitalize your business.
The SBA and SCORE can also help you with the first time business loan process. The SBA program guarantees loans for commercial lenders. This is a way to get financing when banks have turned you down. The SBA will help you through the process and can tell you which banks may want to fund your loan.
SCORE can help with all of the paperwork and the contacts that you will need for finding capital. Even if you are a veteran business owner, the networking can only help. Take advantage, it's free!
Small Business Administration
This is some background on the SBA. FUNCTION: The program is to help competent owners secure funding. While they may not be eligible for financing by typical loaning means, they are also the SBA's most promising commercial loan platform, because business loans under these programs could constitute security for an assortment of ecumenical business enterprise aims. SBA Loans made could be applied to nearly any sensible business aims including working capital, machinery and equipment, pieces of furniture and fixtures, ground and construction (including purchase, refurbishment and fresh building), leasehold advances, and debt refinancing (under particular circumstances). SBA Loans maturity date is upwards of 1 decade for start up, and more often than not upwards of twenty-five years for secured assets.
SBA Loans - The Authority
A self-governing authority of the Executive Office of the President by the national government. They are appointed with the obligation of allowing four main areas of help for American Small business concern. These are: Advocacy, direction, procurement, and fiscal help. Fiscal help is presented mainly by SBA Loans investing plans, SBA Loans plans, tragedy SBA Loan plans, and Bonding for Contractors.
by: Jim Frey
Unsecured Loans for Unemployed People-Smart multipurpose loan assistance for all No Fax Payday Loans-Wonderful and easy to get fiscal assistance Unemployed loans: Derive adequate funds despite unemployed status Paperless Payday Loans– By Saving Precious Time Solve Financial Problems Payday loans–Effective and finest loan aid Minimum Requirements For Restructuring Mortgage San Diego, Ca Faxless Payday Loans USA - Funds without Documents Payday Loans for People on Benefits - Easy Financial Support No Fax Payday loans: Creating flow and easiness in normal life Mortgages And Divorce - What You Need To Know Unsecured Loans CCJ - Avail funds without risking your assets Variable Rate Mortgages: Ten Things You Need To Know Pros and Cons of Fixed Rate Mortgages
