What Lenders Look for

Lenders typically ask the following questions:

  • How much do you want?
  • What’s it for?
  • How will you generate profit to repay on time?
  • Can they trust you?
  • Do you have a good credit history?
  • Do you manage your business well?
  • What if you can’t repay on time?
  • Is there sufficient collateral to repay the loan?

Relevant information which lenders usually require includes:

  • Cash flow projection
  • Income projection
  • Balance sheet projection
  • Sales forecast
  • Cost plan
  • Debt-to-equity ratio
  • Other key ratios
  • Market analysis
  • Past records
  • Scenario analysis
  • Executive summary
    • Concise, direct to the point
    • Written last
    • Introduce the business owner and the business
    • Projected sales, profit and keys to success
    • Peer review