If you’ve applied for loans of any kind, you know there are steps you need to take to keep the process moving forward That’s just as true for a business loan application as it is for a personal loan. When you’re proactive about your business loan application, you’ll experience more efficient processes and decision times, simply because there’s a lot of information required to get the underwriting process underway That information is all in the hands of the applicant: you.
When you’re ready to apply, following these tips will help make your application process easier, smoother and faster.
Top tips to move your business loan application forward
It’s essential to be proactive to keep your application on track. Here’s what you can do:
1. Submit a complete and accurate loan package.
There’s a common misconception that a lender can work on getting a loan approved following the first phone call or meeting. In reality, your loan officer can’t move forward with the underwriting process until they have a complete and accurate loan application from you, including all the required supporting documents.
For that reason, when your officer contacts you, it’s essential that you respond quickly and with information that’s complete and accurate. For example, if the communication is related to necessary documents, be sure to provide them, along with any required signatures.
When you respond quickly and provide the needed information, you ensure that your loan officer has what they need to do their most effective work for you.
2. Be an effective and efficient communicator.
Schedule regular calls with your loan officer. A weekly check-in call is optimal because it means that you’re in touch with your loan officer often enough to keep things moving forward. That way they can address any issues before bumping into deadlines that could delay or otherwise hinder your business loan application.
Depending on the type of project and loan, you may want to include other members of your team, such as your attorney, your certified public accountant (CPA) or bookkeeper, and/or your business’s chief financial officer.
3. Stay organized and use checklists.
Keep this in mind: The best way to demonstrate that you’re going to be a responsible borrower is to show your loan officer that, you’re an organized and responsible applicant.
Use a checklist: your loan officer likely has one for every loan they process. Create yours as soon as you have your first loan call or meeting and update it as new items are requested. Go through your checklist regularly – every day or two is ideal, but at least once a week while your loan is in process. This gives you enough time to get documents together (and you can get ahead on some items) and ensures that you’re less likely to overlook anything that’s needed to move ahead.
4. Follow up regularly on items that are needed from third parties.
If your business loan application involves items that are needed from other parties – such as real estate appraisals, insurance estimates, environmental reviews, or other documents – be sure that you’re fully informed about the status of the process and the paperwork.
For example, if an appraisal or environmental review is required for your business loan, then be sure that you know in advance if you need to be available to let an appraiser or site inspector in to visit the property. Once the required process is complete, find out when you and/or your lender can expect to receive the reports, too.
5. Monitor your personal credit and communicate with your loan officer about any potential major changes to it.
Small business borrowers and lenders rely on personal credit histories for business loan applications, so it’s essential to monitor your credit history. Don’t assume that a credit history or score that a lender obtains at the beginning of the process is the end of that story. Most lenders will check your history again during underwriting or closing to ensure that there aren’t any major changes, such as other personal or business loans that you’ve taken out during this business loan process.
However, lenders also know that life happens. If there’s something that you’ve had to do since first applying for your loan – such as opening a credit card account or a line of credit to cover an emergency or short-term shortfall – let your lender know about it before it’s found on your credit history. New debt can impact the approval of your loan, so it’s important that you be upfront and proactive.
6. Keep your business’s financials updated.
Your loan may require updated financial statements as the process moves forward. This means reconciling a profit-and-loss statement and balance sheet monthly (or quarterly, whichever is required and/or most appropriate for your business). The easiest way to do this is through online bookkeeping software, such as QuickBooks or FreshBooks. When you manage your financials through apps like these, you can generate updated reports in seconds.
7. Make submissions easy to read and submit.
If any documents related to your loan application are illegible or submitted in part instead of in whole, it will slow down the loan application process. Be sure to check any scans and other documents to ensure that they’ll upload accurately and legibly.
If the documents are fine but your equipment isn’t working well, a nearby office-supply store or shipping store may be able to help you scan and send your documents; you can also contact your loan officer to see if you can drop off or mail original hard copies (just be sure to keep copies for your files, too).
We can help, give us a call
We’ve helped thousands of small business owners learn to be better borrowers and that’s why one of our top tips is to contact your Pursuit loan officer. Our team is here to answer questions, guide you through the process and help you get the funds your business needs to succeed. Whether you already have a business loan application in process or simply want to learn more about ways that we can help you, contact us today.