Money & Career
The Trick to Getting a Business Loan
7/8/2013 2:22:18 PM

The same goes for a bank who’s been asked for a business loan by a prospective entrepreneur. "If you walk into a lender’s office and say you want to start a business, but have no idea what tools are needed to make the business work, your potential for getting a business loan drops considerably,” said Carl Thibodeaux, Senior Vice President of Corporate Lending, Lakeside Bank. "When it comes to getting a small business loan, preparation and professionalism are vital.”

The cornerstone of this preparation is a business plan – not an informal plan that you sketched on a sheet of loose leaf paper the night before, but a professional document outlining your business philosophy, including an overview of how you plan to spend the bank’s money. Ideally, the business plan would also include a detailed description of the business, market strategies, information on competitors, plans for operation and management, and financial components. Cash flow projections are another plus. The lender will be aware that these are projections, not guarantees, but including them in the plan adds a significant benefit because it shows the lender you have a plan for how to pay the money back.

"Getting a business loan is not the first step to success. Creating a business plan is step one, followed by your visit to the bank. The lender needs to be assured that you know what you’re doing and have carefully thought about all the elements needed for your success,” Thibodeaux said. "If you’re intimidated by the thought of drafting a business plan, there are several places to get assistance.”

McNeese State University has a program in place to help entrepreneurs, a new SEED Center (Southwest Louisiana Economic and Entrepreneurial Center) is opening this summer and the Internet has an endless array of information to guide aspiring entrepreneurs. The Small Business Administration, www.sba.gov, and Louisiana Economic Development, louisianaeconomicdevelopment.com, are other excellent resources. It’s also a good idea to talk to other business owners to get their insight into the challenges involved with starting and running a business, and of course, as commercial lenders, we are here to help.”

Once you have your business plan drafted, Thibodeaux says you’ll also need to prepare documents that reflect your personal financial status. "This includes a complete list of personal assets and debts. You should also order a copy of your credit rating report from one of the three major credit reporting agencies,” he says. "It’s a good idea to do this well beforehand so you have time to dispute any perceived discrepancies. Although the bank will always perform their own credit check, it’s best if you know where you stand before you ever walk into the lender’s office.”

Once your paperwork is in order, make sure you dress professionally and have adequately researched your desired business, Thibodeaux advises. "A well-organized business plan combined with thorough preparation and a professional attitude will inspire confidence in those lenders you are asking to believe in your business dream. That confidence is key when it comes to getting a business loan.”

For more information on business loans or other commercial banking services available at Lakeside, call (337) 474-3766 or visit www.lakesidebanking.com.

Posted by: Kristy Armand | Submit comment | Tell a friend

Categories: Career  |  Finances

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