Get that money: how to receive a bank loan to buy a business

When buying a business, commercial finance brokers are your best bet for winning the required funds. A bank loan can grant you the flexibility and momentum to complete this important purchase, ensuring that you are financially ready to make the big step forward!

But to ensure you have the funds in place, it is imperative that you have the best commercial finance brokers Melbourne has available working in your corner.

They will help you secure the funding as well as assist you with the following necessities:

Receiving that all important loan

The first – and most reliable option – is to enlist the best commercial finance broker Melbourne has available. Typically, this expert will give you the best idea of what choices are at your disposal in terms of loan options, as they have the industry connections and experience dealing with major banks, non-conforming loan providers and secondary/ tertiary lenders. Whilst they may charge an upfront fee, they will compare all your options and find the one that will provide the best results for you as time goes on.

These highly skilled professionals will utilise the exact same information you will provide the bank if you were to go it alone, and they will be able to establish which lender best meets your business needs. They will then consolidate the data and documentation you require to make the application.

The second option is to head to the bank without any assistance. You and the banker will discuss your potential purchase and your current financial state before the banker looks into your prospective purchase’s current financial situation.

They will look into imperative aspects like cash flow, growth potential, profitability, sales forecasts, if they think you’re able to repay the loan and more, before potentially granting you the loan (however you generally need to provide security to receive it).

The information you will have to provide

Regardless of which option you choose, you will still have to provide a level of documentation that includes:

  1. The business’s current balance sheet;
  2. The business’s full tax return (must be less than two years old);
  3. Information regarding your personal assets & liabilities;
  4. Information about the funds or equity you currently have to make the investment;
  5. Your business owner qualifications;
  6. Forecasts for expected cash, profit & loss (over two years).

How to prepare your application

When you are ready to commence the application, ensure that you have all the necessary documents ready to submit to the bank. The easier you make it for the lender, the greater the chances of them approving your loan. Furthermore, it is vital to have a realistic idea of how much you require, as well as being able to accurately justify why you need that amount.

If you are unsure of how to collate this information, as well as figure out exactly how much you need for the business, you can trust that a highly skilled and experienced commercial finance broker can help you with every step of the process.

They have the industry experience and connections to ensure your application is accurate and ready for submission, acting as a reliable middle person between you and the bank or lender. Having them in your corner not only makes the process smoother, but it can help in the long run, as they can give you a more accurate idea of how much you require and your ability to pay back the loan over time.

For this reason many Melbourne business owners choose their assistance over going it alone.

Infographic provided by Donnelley Financial Solutions, ESG data management

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