Loan Advice from CEOs
How to Improve Your Chances of Getting Approved for a Loan

After business owners have researched the lending landscape and identified a business lending team at the financial institution best suited for them, what can they do to be the best candidate? CEOs share their observations and advice for best practices.
1. A good financial foundation is a must. Pay attention to your financial statements; if you don’t have the experience of running a financial organization, hire someone who does
“One major issue that business owners often face is that, despite knowing the ins-and-outs of their industry and specific business, they often don’t have an equally firm grasp on their financials. [….] A business should also have a team of advisors that include a lawyer, a CPA and a banker.”
- Senior Vice President of Bank of Utah, Scott Parkinson
“In my decades of experience, I’ve seen a lot of small business owners that are great about knowing more “about their widget” (e.g., their individual business product/service) than anyone else, but often times loses focus over time with respect to the underlying financial aspects of the business, especially as the business grows. Their sole fixation on perfecting their business while neglecting core financials and business increases their risk of failure over time. I strongly advise that business owners partner with or hire people who understand the financials of the business – this could mean hiring an accountant, finance professional, etc.”
- CEO of Grand Rapids State Bank, Noah Wilcox
“Businesses must also understand that good bookkeeping is essential. You can easily speed up the process when meeting with a lender by simply being as prepared as possible with your business finances. If you don’t have the expertise to do it yourself, hire a bookkeeper or accountant to manage your business’ finances. Don’t just consult your CPA at year-end to prepare your taxes.”
- CEO of Gesa Credit Union, Christina Lethlean
“Take an active role in your business’ financial organization – be close to the information and pay attention to the numbers. Many small businesses are busy with operational issues, building the business and what not, and may not be creating and monitoring financial reports and cash flows very regularly. Two times a year is not enough – try to do it on a monthly basis at the very least.”
- CEO of San Francisco Federal Credit Union, Steven Stapp
2. Seek the expertise of community resources to help you prepare your application
“For start-up businesses: Many new business owners might have a great vision, but aren’t able to put their ideas down on paper yet. There are many great resources for entrepreneurs, such as small business development centers (SBDC) and the SBA local chapters and community connections/resources. The SBDCs provide business owners with free classes and provide them with technical assistance with things like putting together a business plan, legal information, financial statements and projects, and anything related to accessing capital. At the end of the day, a loan officer at any financial institution cannot spend hours a day helping borrowers put together basic documents. SBDCs can help business owners with their loan package such that when they sit down with the loan officer, they’ll be in better shape.”
- President and CEO of Travis Credit Union, Patsy Van Ouwerkerk
“Don’t be afraid to get help from qualified experts and organizations – go to your local SCORE office or small business development center and ask them to look over your loan agreement with you.”
- CEO of Opportunity Finance Network, Mark Pinsky
“We have local entities in rural communities, like the Small Business Centers in the NC Community College System and other Community Development Corporations, that serve as direct resources for local business owners. Most of our applicants start out in technical assistance with these entities. Then, when they need access to capital, they are referred to alternative lenders like us.”
- Director of the MicroEnterprise Loan Program at the North Carolina Rural Economic Development Center, Carolyn Perry
3. The 5Cs are the golden rules for obtaining traditional bank financing
Credit Score
“For new business owners, take the time to learn about your personal credit history. Initially, there isn’t much a lender can use to assess your character than how well you have managed credit in the past. Importantly, [learn about your score] BEFORE you apply for a business loan so that you are not surprised or adversely affected at a moment when you need money the most. [...] Generally, we ask that applicants have a credit score of 525 or higher and sufficient cash flow to support monthly payments.”
- CEO of Accion East and Online, Paul Quintero
“One critical decision factor – no matter if you’re seeking a $5,000 loan or a $5 million loan – is your personal credit score. All lenders will care about this metric – if someone doesn’t, be wary. As a result, business owners should monitor and maintain their personal credit scores – keep credit card debt low, for example. You really do need a score of 700+ to obtaining traditional “bank” financing.”
- CEO of New Resource Bank, Vincent Siciliano
“Even before you seek a business loan, monitor your credit score and take appropriate measures to clean it up. Your credit score will determine not only whether you will be granted a loan, but also what interest rate you will pay.”
- CEO of San Francisco Federal Credit Union, Steven Stapp
Cash Flow
“Cash flow is one of the most critical elements that any and all bankers will consider when deciding to extend credit. Over the years, I’ve seen a lot of business owners wanting to “have their cake and eat it too.” What I mean by this is as business owners want to avoid paying high taxes and find shelters and tax saving methods, what ends up happening is the cash flow trends can show a negative trend, no longer conforming to “1:1 and above cash flows.”
- CEO of Grand Rapids State Bank, Noah Wilcox
“Before extending any loan, we first look at the health of the business, primarily cash flows. Equity and management are important factors as well.”
- President of Midwest Community Bank, Deryl Schuster
“The advice I often give to business owners is to have an abundance of capital, and access to even more, for those unexpected surprises.”
- CEO of Lone Star Capital Bank, Danny Buck
“Focus on building up capital in order to make your business more appealing as a borrowing candidate. We know it’s tough, particularly for small businesses in the early stages, but having capital helped businesses weather the recent downturn and also makes them a stronger candidate for receiving a loan.”
- CEO of Grand Rapids State Bank, Noah Wilcox
“We look for people who are passionate about their business, and who have a mission and vision. We gauge these things over time, not over night. We look for people who are honest, straight-forward, realistic, and who have demonstrated knowledge of the process”
- CEO of EagleBank, Ron Paul
“We also look at the character of the individuals—are they seasoned executives? Do they have experience?”
- CEO of FastPay, Jed Simon
4. Have a well-prepared application and package put together
“Having a well-prepared package will speed the process along and instill more credibility in you as a borrower. At the end of the day, credit unions [and banks] are highly regulated by the government – we need to document everything and answer to regulators in a similar way that a borrower has to document everything for us.”
- President and CEO of Travis Credit Union, Patsy Van Ouwerkerk
“Know that lenders will look under every rock, two or three times. Make sure you have good financial statements, tax returns, all schedules/K1s, projections, sources and uses of funds. A lender will judge you based on how you fill out your documents – having good attention to detail will go a long way- it was establish you as a more credible candidate”
- CEO of New Resource Bank, Vincent Siciliano
5. Timing matters
“Secondly, don’t seek capital at the last minute, when you need it desperately. The loan process itself takes us a while – anywhere from 30-60 days (especially as we have a customized process). CDFI’s are not a “next-day” loan type of institution. Start building the relationship early.”
- Chief Operating & Lending Officer, EVP of Craft3, Walt Postlewait
6. Don’t give up if you’re denied – keep trying or consider alternatives
“Don't give up hope. As Americans, we are driven to succeed. […] If you are turned down, find out why and what is required that would make your business more attractive to a lender.”
- President and CEO of Texas Trust Credit Union, Jim Minge
“We use different metrics to evaluate customers, and so we can open up segments of the market that are historically underserved by banks. Many banks think that the $50,000 loan is not worth working on because they could be working on a $500,000 loan.”
- CEO of On Deck Capital, Noah Breslow
“A merchant cash advance may be for your business if you have been unable to secure a traditional loan through a bank or credit union, whether because the business is too small (e.g., < $5 million of annual revenue) or because they are in critical need of capital but can’t obtain it.”
- CEO of American Finance Solutions, Scott Griest
“If you still have no luck with traditional banks, you can look for a CDFI (where available, if you qualify). You may qualify even if you don’t live in an underserved market, especially if you are a minority or serve or provide products of value to under-served communities. Don’t exclude yourself before asking.

Finally, try researching types of self-help credit such as informal networks and community associations. For example, if you want to open a grocery store, look for a network or association of grocers. Otherwise, family and friends are often used as a last resort. Many small businesses have had to start with help from the owner’s personal network. Once you get that initial capital, it’s up to you as the business owner to use it wisely and set yourself up for the next steps.”
- CEO of Opportunity Finance Network, Mark Pinsky

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