The 4-Point Checklist That Makes Getting Finance That Bit Easier……
In last week’s blog, I talked about the importance of making an effective application for business finance.
As I said last time, you only get “one shot“ with your application to a lender, so it needs to be as clear, concise and complete as possible.
We’ve worked on 1000’s of funding applications on behalf of clients and as a result of our experience and expertise we’ve devised something called the 4-Point “Access to Funding” Checklist.
It’s the exact same system we use every time we work with a client and it means nothing gets missed and that the lenders get all the information they need in order to make a quick and informed decision.
We wanted to explain how it works and also give you the opportunity to download a copy of the 4-Point Checklist – it means you can prepare beforehand next time you are approaching a lender for finance.
You can download the 4-Point Checklist right here: https://www.fundingtrack.com/blog/checklist-how-to-find-a-good-finance-broker/
In the meantime, here’s a quick summary of the 4 key areas you need to be thinking about if you want to give your application the best possible chance of success:
- All about you – the lender needs to know all about you:
- Are you a sole trader or a limited company?
- What name are you borrowing in – your own name or the limited company? Or perhaps an SPV (Special Purpose Vehicle) specifically set up for the deal
- What’s your background, your experience and your expertise?
- You need to provide details of any previous business ventures in which you have been involved
- You’ll also need to provide something called an ALIE – asset/liability/income/expenditure statement – important for understanding your personal financial position
- All about the business/project – the lender needs to know about your business plans or proposals:
- You’ll need to provide the location and address of the business or property
- You’ll also need to provide some background to the deal
- And don’t forget your plans and proposals for the future – what are they?
- Any other information that you consider relevant to the proposal that you think we or the lender need to know? Make sure you include it
- All about the numbers – without them we can’t begin to help:
- What’s the purchase price of the business or property you are buying
- If you already own the business or property what’s the value
- How much cash do you have available to put into the deal – how is that cash being raised – savings, borrowed, gift from family – we need to know
- How much do you need to borrow?
- What about the turnover and profitability for the business?
- If it’s a property development, then what’s the current value, what are the development costs and what is the GDV (Gross Development Value)
- All about the paperwork – the additional information you need to provide:
- Proof of ID – copy of your passport
- Proof of Residency – copy of a utility bill
- Last 3 months personal bank statements
- Fully completed ALIE – see above
This information is required as an absolute minimum and when we’re making an application on behalf of a client we always ask for it when we have our initial meeting. Other information that is likely to be required depending on the type of deal includes:
- Accounts for the business in question – last 2-3 years normally required
- Last 3 months business bank statements if you already own the business
- Any projections or cash flow forecasts that are available
- And if it’s a property development then a breakdown of the build/development costs along with copies of plans and planning permission if relevant.
Providing this information will streamline your funding application and therefore means you get a quicker decision.
If you’d like more detail simply download the 4-Point Checklist here: https://www.fundingtrack.com/blog/checklist-how-to-find-a-good-finance-broker/
Whether you are arranging the finance yourself or are using a specialist broker like ourselves, lenders all need the same basic information.
Now you know what it is!