Key strategies for crafting a successful business finance application

When making any kind of business finance application how do you as a business maximise your chances of success, because as in life, the first impressions of a finance application really matter. And yet, many clients who come to us looking for any form of business finance, are often not prepared and are unsure of what they want or need. 

At MHA, we understand the importance of presenting a compelling case to lenders. We often advise clients that if they fail to convince us, convincing other lenders might prove challenging.

However, there are few things you can do as a commercial borrower to prepare your finance application properly and give yourself the best possible chance of getting approved for the finance you seek.

Below you’ll find three key considerations for anyone looking to apply for any kind of business finance. If you follow the advice below, we believe it could make the difference between getting your funding completed, or perhaps not even getting off the starting line.

Craft your finance story

In the current world of business finance, decisions are made more often these days by computer algorithms, to at least make an initial credit assessment, but nearly always the final outcome is determined by human intervention. This is especially true for larger or more complex transactions.

So just like any kind of human interaction, it’s important to look your best. This means you should take the time to make your application look the best it possibly can. If you appear disorganised and unprepared, this will be obvious to a lender who specialises in business finance and sees applications from companies like yours every day.

Outline what you need as follows:

• Decide how much you’d like to borrow – The first piece of information to include on your lending application is the amount you’d like to borrow. This allows the bank to quantify your request.
• Explain what you intend to do with the finance – The bank will want to check the intended purpose is suitable and determine which type of finance is best suited to your needs.
• Determine how long you want the finance for – The term of the loan will help the bank to assess its affordability and find the right type of finance for you.

Demonstrate financial viability

Once you’ve outlined how much money you need, the reason for the loan, and the repayment term, it is your job to show the business is financially viable. This will help to prove to the bank that you can afford the finance requested.

Conduct thorough research 

You may know exactly what facility you need, or you may have a vague idea of what might be on offer, but there’s no point applying for a product your business doesn’t qualify for or won’t actually give you the funding you need in your specific circumstances. So, acquaint yourself with the various business funding solutions that are available and determine which ones are most suitable for your business’s needs.

Once you know exactly which funding solution works best for your business then compare a few different lenders to understand their offerings and requirements. Knowing the landscape helps you tailor your approach to get the best offer and select the most suitable lender.

Perhaps you’re not sure which is the most suitable commercial finance type for your business?

Consider seeking guidance from professional commercial finance advisors who can provide expert advice and support throughout the application process. The Banking & Finance team at MHA are FCA regulated and can offer the impartial business advice and support you need to make informed decision about the best financing options for your business.