If your business is technically not eligible for a certain type of financing, no amount of detail provided in your application is likely going to help swing the lender in your favor.
There is no question that a well prepared application package that is well organized, informative, and visually appealing can help you impress a lender and for marginal deals that are just on the bubble, perhaps this can put you over the top.
But the bigger concern with business applications is to not talk yourself out of biz financing that you would be otherwise eligible for, but still get declined due to poor, inconsistent, inaccurate, misleading, or even false presentations.
The application package you submit should be designed to present the specifics of the business as accurately and clearly as possible. And while this is the intention most business managers and owners, they cross themselves up by not making sure that all the information provide is consistent and relevant to the case for business financing they are trying to build.
Here are some examples of what I call business financing application Faux Pas.
Key takeaway: Reconcile your numbers. Go through your draft submission and make sure there are no inconsistencies from one set of statements or forms to another and that the information is consistently described and presented accurately.
Key takeaway. Make sure you answer the following questions: what is your plan to market your business and what is it based on? Customer or prospect letters of intent, conditional purchase orders, and market research clearly stating what certain segments of your market want make your projections and assumptions more believable as well. And all income and expense assumptions should be supported by unique and clear logic that can be substantiated if required.
Many business owners feel like spending too much time on a business application is a waste of time, and that can be true if the business case is easily supported. On the flip side, a poorly prepared application package or one that is thin on pertinent information is not likely to get you anywhere, even if the actual business can support the debt being requested.
A business financing application is also a reflection of how you attend to business and the level of detail you invest in managing the business and managing risk.
For a new financing source, its also the one chance to make a first impression that could be lasting.