Bankers Offer Advice For Owners Seeking Loans

The American Bankers Association recently found that the most important step in applying for a small business loan—having all the necessary financial documentation—is also where most entrepreneurs make the biggest mistake.
According to an informal survey of its member banks, nearly 74% of the bankers responding to the survey said financial documentation was the most important aspect in securing a loan, but 67% also said applicants typically lack the documentation they need.
The survey also found that 52.3% of the participants believe a complete business plan is a key to securing a loan, and 45.5% want a completed application. Surprisingly, only 30.7% said collateral was one of the most important factors. Accordingly, the additional mistakes that applicants make include having an incomplete business plan 43.2% of the time, lacking collateral 27.3% of the time, and not having all of the application paperwork 22.7% of the time.