MgtOps_Amaya_Urzaa

When historical financial performance of the company is not sufficient to support the current request for financing.

• Conditions - are the conditions right for the type of business
• Character - the general impression that the business and its owners make on the lender; education background and business experience of owners is reviewed.
• Capital - How much equity does the business have? A measure of the owners' personal investment into the business.
• Credit - ability to effectively manage debt repayment
• Capacity - plan and/or prior years' financials must show that the business can produce enough cash to repay the loan
• Collateral - secondary source of repayment

• Industry trend reports
• Target market demographic studies
• Competitive Analysis
• Resumes

• Resume
• Personal financial statement
• Business and personal financial information

• Business tax returns
• Business balance sheet

• Debt / Equity ratio = Leverage (usually needs to be not more than 3)
• Current ratio
• Quick ratio

• Business credit report
• Business balance sheet and/or tax returns
• Personal credit report
• Personal financial statement

• Personal credit scores should be at least 630.
• Scores above 700 are considered good.
• All types ofaccounts should be used: revolving, installment, credit cards, mortgage accounts.
• At least 60 months of credit experience, and at least 7 open accounts.
• Debt-to-limit ratios are considered on revolving accounts.

• Business tax returns
• Business income statement
• Business cash flor statement
• Personal tax returns

Remember: Generally loans need to be fully collateralized.

• Business tax returns
• Business balance sheet
• Accounts receivable aging
• Inventory report
• Depreciation schedule
• Appraisal of real estate
• Purchase order or invoice
• Personal financial statement