What You Should Know Before You Apply For A Commercial Loan

The first and most important thing that you should do when it comes to applying for

a commercial loan is to come up with a good business plan, explains Carlos Hank Rhon. Lenders who work for banks and other financial institutions want to be sure that you are hoping to start a credible business and that you have all of the necessary knowledge and skills that are required in order to run a successful business. You need to include everything positive about your business in your business plan including all of your goals, your competitors, past projected revenue and expenses, possible marketing strategies and how you intend to grow as a company. Your business plan should show why you are the best person to get this company on its feet and move forward with it into the future. After all of that you should also include an exclusive summary for your lender that will further explain what your vision for your company truly is. The summary will be the first thing that your lenders will read when they look at your business plan and it could also end up being the last thing they read from you if they are not interested right away so therefore it is important to have a steady business plan.

Another thing that you should have ready when you go to apply for a commercial loan is all of your financial statements, notes Carlos Hank Rhon You will want to include all of the financial statements from the past as well as any current ones that you have on hand so that you can show projected numbers to your lenders which will give them a clear outlook on how you will be able to meet your goals as you have stated in your business plan. You should also include cash flow statements, income statements and balance statements for the past three to five years if possible.

After you have worked on your business plan and organized all of your financial statements, you should have a clear idea of what you would like to accomplish with your new commercial loan and how much money you will need to borrow in order to reach your business goals, explains Carlos Hank Rhon. Being able to clearly state the need for the loan to your lenders in person will help you to get the message across and allow your lenders to understand more about what you have in mind for your company. You want to be able to display all of your research and documents to your lenders so that they will be able to see that you are taking your leadership goals seriously and that you are not trying to simply take an easy route with your company.

Another thing that you should know about before you look into applying for a commercial loan is your own personal credit history. There are some types of business loans that may require you to put down some type of collateral. If this is the type of loan you are applying for, you will need to know how much your particular form of collateral is worth. Lenders want to know this information up front and it is a good idea to find out more about your real estate or other collaterals worth before you get started with the loan application process.

by: Sandeep Thakur

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