How to Get Financing For Your Business
How to Get Financing For Your Business
What Does a Lender Look For?
When considering a loan, the lender looks for the following key factors:
Capacity
Character
Collateral
Capital
Conditions
In order for the lender to assess your particular situation, you will need to provide documentation that allows them to review the current state of your business and personal finances.
What info will be needed to start a loan process?
Documentation requirements will vary depending on the type of loan you are considering. The following items are commonly required to start a loan application:
Purpose of loan: equipment, inventory, working capital, real estate purchase, etc.
Amount requested and how it will be used, including owners’ equity available for down payment
Business plan
2-3 years of business financial projections—income statement, balance sheet, and cash flow as well as explanation of the assumptions used for the projections
2-3 years of business financials or tax returns
Schedule of existing debts
Aging of accounts receivable and payable
2-3 years of personal tax returns
Personal financial statements of principal owners
Resumes of principal owners
This All Seems a Bit Overwhelming…HELP!
It is very common for small businesses to, at some point, need assistance with formalizing business plans, forecasting, analyzing business financials, and other business ownership details. Fortunately, there are many FREE resources available to help put those pieces together for you.
First, Dakota Business Lending frequently refers our borrowers to the following entrepreneurial development resources for education, training, and technical assistance:
Women's Business Center
Assists current & potential women business owners with training, technology, & development.
SCORE Mentors
Retired business owners volunteer to mentor and counsel small business owners
Small Business Development Center
Assists small businesses with business plans & financial projections.
Veterans Business Outreach Center
Assists service members, veterans, & military spouses looking to start, purchase, or grow a business.
Secondly, the Small Business Administration (SBA) website contains a wealth of information on starting and running a business, including:
SBA Learning Center
This portal includes many online training courses on almost every aspect of business ownership
Small Business Resource Guide
Download this guide that includes various aspects on starting and operating a business
Email Newsletter
Email dedicated to providing valuable information about starting & growing a small business
Ready to Consider Loan Options?
Give us a call! We can guide you through the process and point you toward various resources that may become part of your loan package. We would be delighted to help you look at options that work in conjunction with your bank or credit union and are beneficial for the cash flow of your small business. Whether you need $1000 or $5+ million, we have options you may want to consider!