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Last Updated: 31st May, 2021

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Note: We are only accepting applications for business loans with a minimum deposit of 50%. We apologise for the inconvenience.

What do I have to include in the proposal?

Did you know that a well-presented business loan proposal can help you get approved for business finance?

Find out what to include in a business proposal and tips that can help you prepare it.

Is a business loan proposal absolutely necessary?

You can take out a business loan for various purposes. This includes equipment finance, working capital finance through factoring or invoice discounting, and more. However, there’s no guarantee that things will turn out exactly as predicted even if you secure finance.

To convince a lender to finance your business, you’ll need a business loan proposal. Lenders prefer a business proposal that’s well researched and well presented.

Through a business loan proposal, you’re essentially showing that you can afford the loan. It shows that you’re serious and you know what you’re doing. It also shows your projected cash flow and income streams.

Facts and figures in your business plan can help lenders identify the overall risk of a loan application. Lenders may not approve your loan application if you can’t provide a business proposal.

There are other benefits to preparing a business loan proposal. You’re likely to learn more about your industry, market and the business itself when preparing one. This can help you watch out for potential risks and stay ahead of your competitors.

You’ll need a business loan proposal even if you apply for low doc or no doc business loans.

Preparing a strong business loan proposal

A business proposal helps provide direction, keep track of your goals and is required to secure finance. You can start working on it after you’ve researched your business and the market.

Generally, lenders will want a business loan proposal to include:

  • Title page: This page must have your name, your title, the name and address of your business, and your ABN. If you’re a company, include your ACN.
  • Executive summary: This is a concise overview of the entire business proposal. You can prepare this once you’ve completed your business loan proposal. Describe yourself, your business and how the loan will be used to meet company goals.
  • Business details: This includes your business structure, location and premises, staff details, products and services, and operations plan. This can help the lenders understand your business and how you’ll be using the loan.
  • Market details: Details regarding your market including your customer and competition fall under this. You can include your marketing plan to show lenders your market strategy.
  • Financial details: Lenders want to see how you’ll finance your business. They also want your cost and financial projections. You can include your debtor and creditor information here as well.
  • Supporting documents: This includes BAS statements, exit strategy and other supporting documents such as a cash flow forecast. You can include any document here that can support your claims and stated information. Media reports and client testimonials can also be included here.

After you’ve done this and prepared your business loan proposal, you can apply for a business loan. However, applying for the right loan with the right lender is key.

Our mortgage brokers have many years of experience in the business loan sector. We also have relationships with a panel of almost 40 lenders. We can help you prepare a strong business loan proposal and apply with the right lender.

You can speak with our credit specialists by calling us on 1300 889 743. If you want one of our brokers to contact you instead, you can complete our free online assessment form.

What to do before you prepare a business loan proposal

Lenders will likely question a hastily made business loan proposal. This is why you have to conduct proper research and analysis before you prepare it.

Before you start working on your business proposal, make sure you analyse your business and the market. Determine how you’ll use the loan and whether or not it will be profitable.

Seek business advice and support from professionals or through seminars and business events. Lenders will want to lend to confident and knowledgeable borrowers.

You’ll need supporting documents in your proposal so you can start collecting them. This can include cash flow statements, projections, BAS statements and other reports.

You can essentially apply for a business loan after you complete the proposal. So, it may be a good idea to get a security property ready. Lenders prefer property types that aren’t specialised and can be easily sold.

Also, make sure that your credit file is clear and you have an above average credit score. If you have bad credit, you can wait for your credit to clear. You can consider applying for a bad credit business loan if you don’t want to wait.

Tips when preparing a business loan proposal

You can consider the following tips when preparing a business proposal:

  • Set clear goals: With a clear set of goals, it can be easier for you to determine if you really need a business loan. You can then include this in your business proposal.
  • Research: Researching your business, market as well as the economy can help you prepare a strong business proposal. The facts and figures you’ve researched can help you qualify for a good deal on a business loan. Note that you’ll also have to be a strong business with a strong income.
  • Language and structure: The language you use in your business proposal must be simple and easy to understand. Lenders may not understand your industry jargon so limit them. Avoid a complex structure to avoid confusing the lenders.
  • Seek advice if you’re uncertain: Mortgage brokers who specialise in business loans can help you prepare an acceptable business proposal. You can also seek the advice of other experts and professionals.
  • Plan your presentation: Even if you have a strong business loan proposal, you’ll still have to present it properly. Prepare and plan your presentation so you can impress the lenders and get approved for a business loan.

After you’ve prepared your business plan, make sure you review it regularly. This way, it can stay up to date and can help keep your business on track. You can also use it the next time you want a business loan.


Business loan proposal FAQs

How long should a business loan proposal be?

The length of a business loan proposal generally depends on the loan amount and the lender you apply with.

This means that you’ll likely need a long and detailed business proposal for larger loans. A concise, one page proposal may be sufficient for smaller, short term loans.

Depending on your overall business strength and financial position, lenders can accept just a business loan proposal letter.

What if I don’t qualify even with a strong business loan proposal?

If you don’t qualify for a business loan, you can check out if you qualify for a government grant instead. To learn more about this, you can check out the government grants page in the business.gov.au website.

You can also take the help of one of our mortgage brokers. Our services are free in most cases and we can help you get approved with a more flexible lender.

Call us on 1300 889 743 or fill in our free online application form to speak with one of our credit specialists.

What if I want a home loan in the name of a company?

You may be referred to business banking if you want a home loan in the name of a trust, partnership or company. Make sure you avoid this since you’ll basically be paying more for the same product.

Business loans usually cost more than normal home loans. Bank lending policy is more strict and business loan interest rates are higher as well.

However, please note that you may have to pay slightly higher loan fees though. This is because the lender will have to draw up more extensive loan documents. These will encompass a personal guarantee from the directors.