What You Should Know Before You Request Financing

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- by Todd Jensen

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Asking for money is never an easy task, and when it
comes to finding financing for your business, it can be
even more difficult. There are several steps you can
take to improve your chances of acquiring funding and
making the process a smooth one.

Be Prepared

First, be prepared to explain to your potential lender
why you need a loan or line of credit for your
business.

Come prepared with complete, accurate and up-to-date
financial records. You should have the basics with you:
profit-and-loss statement, balance sheet, and projected
cash flow. Reference letters from previous lenders,
current suppliers and any strategic partners may not be
required but can help to impress financiers.
Secondary documents you should have prepared for your
lender include: a current business plan, a client list
and appraisals of assets that may serve as loan
collateral.

A Good Credit History is Critical

Be sure that your and your business partners’ credit
history is clean and in good standing. Be prepared to
explain any irregularities or problems.

Loans are serious business. Your lender thinks so and
so should you. Review the terms, payment, interest and
fine print of any loan agreement. If you can, consider
having your attorney and accountant review the terms.
Request the documents in advance so there is time to
review them.

Don’t Settle—Shop Around

Finally, don’t just settle for the first bank that says
yes or the one bank you usually do business with. Shop
around and consider the terms and interest. This will
improve your chances of getting the best terms and
finding a lender.

Every bank has its own criteria and requirements for
lending to businesses. It’s important to pick a program
that best suits your business and your needs.

Take the time now to prepare and establish your
business credit line so your business can grow
responsibly and dynamically.

This article brought to you by Todd Jensen, a member
of the Principa Alliance.

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Todd Jensen, “The Profit Engineer”, has helped hundreds of
business owners make their businesses more successful and
profitable. For tips and strategies on how to boost your
business success as well as increase your profits, visit
http://www.theprofitengineer.com or http://www.maxqtc.com
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