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This is a section of the business plan that the lender needs to know in order to approve the loan to the business owner. If an entrepreneur does not have all the important information in this section. They could either cause the loan that they applied for to be delayed. Or, completely rejected.
One of the first things that an entrepreneur needs to understand is that even if they are applying for a loan from their regular bank says virtual accountant. This does not mean the banker that they are familiar with. Is going to be the one reviewing their business plan and loan application.
The bank will have an underwriter, who is not familiar with the business to look over the business plan in order to make the decision. On whether to loan money to the business or not. Therefore, virtual accountant says an entrepreneur must not leave any information out. Or assume that the bank will know what they are referring to.
The first thing that business owners need to understand is that the company overview section of their business plan. Is who the entrepreneurs are, who is involved in the business, and who are the advisors at an extremely high level.
Many entrepreneurs take this information for granted because they know it extremely well. But they need to understand that the company overview section is designed to be read by an external reader. So that they need to spell out all of the information very clearly.
Therefore, the first thing that a business owner can do is include not just the operating name of their company. But the legal name of their company as well. That many entrepreneurs end up be using the legal name or the operating name interchangeably throughout the business plan. So why including both names in the overview section. Can eliminate the potential for confusion.
The business owner will then need to specify the owner of the company, and their contact information. If they have more than one shareholder of the corporation. They should include this information in the company overview section. Being sure to specify what percentage of the corporation each shareholder owns.
The bank will not loan money to a company, if they do not know all of the shareholders, and what percentage of the corporation each shareholder owns. Making this an extremely important bit of information to include.
They should also ensure that there including the address, phone number, email address, and website if the business has one. And even if they do not have a physical address as of yet. Because the business is not in operation at the moment. They should include whatever address is used to incorporate the business.
By including as much factual information about the company as possible. Make it much easier for the underwriter to verify this information. And make the determination if the business qualifies for the loan in the first place. So that they can look at the executive summary to see if they will be willing to loan money to the company.
Many business owners make the assumption that the company overview section is just the name and address of the business says virtual accountant. But this is the section that helps a bank determine if a company meets all of the requirements for being approved for a loan.
The information that a business owner can include in this section. Can help them not just get the approval that they are looking for. But can help expedite the loan process. If the underwriter has decided the qualify.
Because of this, it is very important that an entrepreneur includes all information that they will need to have. If they get the loan approval. Such as general liability insurance. This is going to be a requirement of the bank to have before awarding funding. And if the business owner is approved for the loan. Then they are going to have to get insurance and provide proof of it.
However, if they already have this insurance in place. They can include that information in the company overview section. So that they can speed up the time it takes to finalize the loan.
The same is true for life and disability insurance. Virtual accountant says it is typically a requirement to finalize the loan. That the entrepreneurs have insurance. This way, the bank will be guaranteed to get their money back if the entrepreneur of the business gets injured, gets sick, or passes away.
If an entrepreneur already has this insurance. And puts it directly into the company overview section. Not only can the underwriter verify this information. But if they are approved for the loan. That can take one more requirement that has to be accomplished off that list. So that they can speed up the approval process.
If a business owner is using their investments as security. They should include that information on the company overview section as well. Including the name of the company, the advisor, as well as the contact information. So that the underwriter can verify this information. And so that it can be included in the paperwork when the loan is approved says virtual accountant.
Also, the business is lawyer should be included in the company overview section. Because the bank will require an entrepreneur to have several legal documents filled out in order to complete the application and approval process. By including this information in the company overview section. Can help ensure that the bank can get the appropriate documents to the lawyer in a timely fashion.
By understanding how important the company overview section is. Not just in helping the entrepreneur meet the requirements of the loan. But helping speed up the process once the loan is approved. Then they can put the most important information into the section. And significantly help themselves.
