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However, entrepreneurs should not get so stuck on creating the best executive summary that they possibly can. That they miss putting very important and vital information. Into the company overview section of their business plan.
Virtual accountant says the company overview section is only moderately less important than the executive summary. And if an entrepreneur does not put important information in this section. They may significantly slow down their loan application. Or, the bank might reject the application outright. Because of the lack of information.
The company overview section is the part of the business plan that tells the bankers and the underwriters. Who the owners are, who all is involved in this company. And who the advisors are to the business. At a very high level. Many business owners do not understand the importance of this information. And forget that it is designed to be read by an external reader.
Since the company overview section is the second most important information. An entrepreneur needs to spend a significant amount of time here to ensure that they do not miss important information.
The first thing that they need to ensure that they put on the business plan. Is a list of who all of the owners of the business are going to be. If it is a soul owner says virtual accountant. Then simply put all of their contact information. From email, phone number, and home address. Is going to be crucial.
If there are multiple shareholders. Then all of that information needs to be included. But an entrepreneur also needs to ensure that they are putting the percentage of shares each shareholder has in the corporation as well.
The next thing that they need to include in all of the same types of information, but for the business itself. This includes the legal aim as well as the operating name of the company. The address, and if the business does not have a physical address yet. Because they have not obtained their loan. In order to buy the property.
The entrepreneur needs to ensure that they are including the address for the business that they used when they incorporated it. They also need to ensure that there putting the phone number for the business, email address, and website if they have one. Because the banker or underwriter is going to research this to verify its accuracy.
The more information they can include in the company overview section. And the easier they can make it for the banks to verify. The faster they are going to be able to get through the bank application. And not miss out on potentially getting rejected for the loan. Because they do not have enough information.
The company overview section is a very important part of an entrepreneur’s business plan says virtual accountant. Because it includes vital information that is necessary for an entrepreneur to have. In order to get approved for a business loan.
Whether this business loan is to get approval to get financing so that they can purchase their business and start their company for the first time. Or if they are already in operation. And they need to purchase assets, or building in order to expand their operations.
By making it very easy for the bank to understand who is involved in the company. Can help speed the application along. And since it can take an extremely long time to get loan approval. Anything that an entrepreneur can do to make it easy and speed up is very important.
It is very important that an entrepreneur will have a lawyer in place says virtual accountant. Because the lawyer will be required in order to complete important paperwork related to the loan. This can include things like securities on their property and equipment that must be registered. Two personal guarantees that an entrepreneur needs to make.
Since they will need to have their own lawyer to execute these documents. Putting that lawyer’s information into the company overview section. Can help the banker and the underwriter understand that if they approve the loan. They will not be held up with trying to find a lawyer at the eleventh hour to complete the application.
Often, the bank will even require business owners to have life and disability insurance. This is often a covenant that the bank puts in place. So that if they approve the loan to an entrepreneur. And the entrepreneur gets injured or dies. They will be guaranteed to get their money back.
Therefore, if an entrepreneur and all of the shareholders already have life and disability insurance. Including this information into the business loan. Can be extremely beneficial to speeding up the process.
Often, the banks will even require the business owner to agree to carry that insurance for as long as they owe money to the bank and are paying that loan back.
Virtual accountant says it is also important that the bank knows that the business is carrying in their general liability insurance as well. This is almost a 100% certainty that the bank will look into this before approving the loan. Since it is required for businesses to have to operate. The bank will want to know that it is in place already.
If an entrepreneur has been working with an accountant. It is important that they put the accountants’ information into the company overview section as well. Because banks often see this as a risk mitigation factor. Because accountants will generally ensure that the cash flow projections are accurate and that entrepreneurs’ business plan is realistic.
All of these things can help increase in entrepreneurs chances of getting approved for a loan. And can help an underwriter know all of the most important information. So that their verification of the information can be faster. And help them get approved for a loan.
