August 3, 2017
As a bank, we are just like other businesses. Our product just happens to be money. Other businesses sell widgets or services; we sell money — in the form of loans, certificates of deposit (CDs) and other financial products. We make money on the interest we charge on loans.
Although it seems detached and impersonal, it’s actually just the opposite. As a bank, we’re essentially the head cheer-leader for “team you”. When you succeed, we succeed. When you win, we win.
We have a second role with team you. To continue the analogy, we also act as one of your coaches. In this case, we have the responsibility to make sure you’re ready to play in the big (business) game. The competition is hard-hitting and relentless; but if you’re ready, if your business is in good shape and you have the extra resources available when you need them, you can come out on top.
As a bank, one of the resources we can provide comes in the form of a loan; and we really want you to have the loan, the resources you need to win. What we don’t want, is for you to lose, or get hurt if you’re really not ready.
Just like a coach, we are going to push you hard in training, we are going to ask all the hard questions and get all the right information before we give you the ball. We need you to convince us that you know what you’re doing. We need you to convince us that you’re ready. So, let’s see what sort of questions you will need to be prepared to answer.
Know how much money you need and perhaps even more important, what you need it for. If you need it for equipment, you should have several quotes from different vendors ready to show us. We will want to see your estimates of the operating and maintenance costs as well.
Be prepared to be able to tell us how quickly you need the money (clearly the longer lead-time you give us the better), and an idea of when you will prepared to pull the trigger on the project.
Obviously, one of our priorities will be getting paid back. We will want to see that you have considered how long you plan on needing to pay us back, and what safe-guards (i.e., collateral) you are putting on the table.
Whether the loan is for equipment, people, physical improvements or expansion, you must be able to show us how these will benefit your company, what new revenues they will generate, and how much profit you will realize. After-all, this new profit is most likely where you will find the money to make your loan payments, so this information needs to be well thought out and supportable. Input from trusted business and financial advisers familiar with your industry will be important. Give us enough information so we are aware of the depth of analysis you invested in this part of the process. It will lend you credibility and give us more confidence in you and your ability to pay back the loan.
Other information and documentation you should have at the ready include:
- Past and projected financial statements
- Who are your suppliers
- Other business debt
- Ownership and affiliations
- Income tax returns
- An overview and history of your business
- Your loan application history (if you have one)
- Your business credit report
- Details of accounts receivable and accounts payable
- Pertinent legal documents such as
- Business licenses and registrations
- Articles of incorporation
- Copies of third party contracts
- Franchise agreements
- Commercial leases
Finally, be knowledgeable about what type of loan you want and what would be best for you. We offer several types of loans, including SBA loans, commercial term loans, commercial mortgages and lines of credit.
Regardless of what type of loan you pursue, you need to be prepared to answer the tough questions and make us confident in you and your business.
However, you should be prepared to ask us some tough questions as well. If there is anything you don’t understand, we encourage you to bring your own trusted advisers, such as your accountant/CPA, your attorney, or your financial advisers into the process as well. We want to be sure that you understand the terms of the loan and the obligations (both yours’ and ours’).
At Coastway, we want to be part of a winning team and we want you on that team with us. Please call us with any questions!