Applying for a business loan is more or less the same as applying for a job or an opportunity. Therefore, it has to be compelling and persuasive if it must be done right. That way, your loan request won’t be turned down by loan officers.
While there are samples of loan application letters to model after, there is nothing more helpful than tested and proven strategies shared on ReviewsBird.com by entrepreneurs who have passed through the process. Their experiences are enough to walk you through your ‘loan’ journey.
Do you need a small business loan request letter?
This is like asking if you can do without loans for your business. The answer is no. Loans are imperative no matter the type of business you run. However, less time is spent on requesting loans for small businesses than for large businesses. A business loan request is needed for either conventional bank term loans or SBA loans. Checking on loan companies reviews, while a few companies won’t request an application before you can secure a loan, most companies would.
Also, since the primary purpose of writing a request is to convince a lender that you need loans for your company, you can never dodge the protocol of providing important information about the history of your business and financial status. Your request must be convincing enough so you can be given the loan you ask for.
How do you go about writing loan requests?
A loan request is half cover letter and half resume. Like most formal letters, there are things to include and things to exclude. The following will show you how to write compelling loan requests that can’t be turned down.
1. Header and Greeting
Your loan request should start with a header and greeting that contains your own name, your business name, your contact details (address, email, and phone number), your lender’s name and title, your lender’s contact details, and a subject line with your requested loan amount.
2. Business Loan Request Summary
After header and greeting, you move to the body which should include a summary of your intention. Let the summary, usually not more than 350 words, be about the description of your request, your business information, how much you need, why you need it, and why you should be chosen for it.
3. Business Information
The introductory part of your request should contain your basic business information such as the legal name, entity structure, specialization, duration of operation, number of employees, business environment, and current annual revenue.
4. Purpose of the Loan
After the introductory paragraph, the main paragraph should extensively discuss what you need the loan for and how you intend to use it. Be reminded to compel with your strengths and then persuade to your weakness.
5. Evidence that You will Repay the Loan
It is never complete without providing evidence that you will repay the loan. Guarantee the lender by moving on how you will recover the money by exploring opportunities that await such a loan.
The Bottom Line
You can’t do without a loan request. A good loan contains an introduction, a body, and a conclusion. The conclusion would summarize everything and especially ring around how you intend to pay back the loan.