How to Expedite Your Loan Application
If you plan to apply for a business loan and would like to expedite the turnaround time for a decision, consider the recommendations below. These tips are provided by Connecticut Innovations’ Lending Group.
Before meeting or talking with commercial lenders:
Collect financial information.
Historical: Assemble financial records for the most recent three calendar or fiscal years, including your business’s financial statements (balance sheet, income statement and cash flow statement, including all schedules) and tax returns, your personal tax returns, and a signed personal financial statement (if you own 20 percent or more of the business). Your accountant should have these on file.
Current: Additionally, gather financial statements for the current fiscal year to date, your business debt schedule, and accounts receivable, accounts payable and updated inventory reports.
Future: Finally, prepare financial projections (with assumptions and supporting data) for the remainder of the current fiscal year as well as the next two years.
Prepare a company summary. If you do not have a formal business plan, don’t panic. You may submit a business summary, which contains many key elements of a business plan, addressed in a more concise fashion. Include discussions of: company history, management team, the product and/or services you offer, the markets you operate in, the state of your industry (whether growing, mature, contracting), and major competitors and how your products/services differ. Additionally, provide resumes of key principals of the business.
Collect other documents (as needed). If you are seeking financing for the purchase or construction of real estate, gather (as applicable): executed purchase and sale agreement, real estate appraisal, environmental report and any construction plans, permits, budget, etc., for the project.
If you are seeking financing for the purchase of equipment, be prepared to submit the equipment appraisal and a detailed list of the fixed assets your business owns (i.e., property, machinery and equipment).
When meeting or talking with lenders:
Identify your borrowing needs. When you speak with prospective lenders, be prepared to talk about the current state of your business, plans for growing your business, why you are seeking financing and how much financing you feel you need. Discuss whether your accounts receivable are growing or slowing, and why.
After a frank discussion, your lender should be able to identify the appropriate financing product for you. This may, for example, be a permanent working capital loan to help you ramp up production if your accounts receivable are growing, or to help you pay creditors if your accounts receivable are slowing. Additionally, the lender may decide that it wishes to partner with Connecticut Innovations to meet your financing needs.
After you meet or talk with lenders:
Complete the lender’s loan application. If the lender you have spoken with invites you to submit a financing application, be sure to complete all relevant sections. An incomplete application will likely delay the processing of your request.
Submit your financial statements, business summary information and other required documents electronically. Lenders generally prefer to receive this information in an electronic format, not mailed as hard copy via U.S. Postal Service.
Be responsive to lenders’ follow-up questions. Even if the information you submitted is 100 percent complete, the lender will most likely ask you to clarify certain points or gather more detail in certain areas. Be sure you respond promptly.