Creating and running a business is a proud and important part of life. During the course of having a business, there may be times in which a business owner needs some extra financial assistance. During this time, they may look to a bank for this help. In order to receive a business loan from a bank, business owners need to take certain steps and meet certain basic requirements. Continue reading below to learn more and contact an experienced New Jersey certified public accountant and consultant for assistance.
What Does a Banker Need?
When applying for a business loan, bankers need to have the following information:
- A written request for a specific amount of money
- A detailed explanation of the use of the funds
- A projection of how and when you will repay the loan
- A list of the collateral you are offering as a security for the loan
In addition to this, bankers will also want to know what will happen in the event that you become disabled or die. This may be if you have disability, life, or general liability insurance.
What Else Does a Banker Need to Know?
There is further information that a banker will want to know when they receive an application for a business loan. This can include:
- The financial history of the company in the form of company balance sheets and profit and loss statements for at least the last three years.
- A realistic projection of profits and a twelve-month cash flow projection. This spreadsheet should show the specific month cash will be received from sources and the month specific disbursements need to be made.
- A narrative relating your personal business experience.
- The company plan that tells where the company will be several years. This is in terms of size, types of products or services, number of employees, locations, etc., to give the banker some insight into your long-range planning.
- Personal tax returns for each major owner of the business for the past three years
Contact our Firm
Werdann DeVito LLC is an experienced Certified Public Accountant firm serving clients throughout New Jersey with all of their financial needs. If you need quality assistance with accounting, tax, or consulting services, contact Werdann DeVito LLC today.