sample of a business plan for a loan

• Credit cards
• View all credit cards
• Banking guide
• Loans guide
• Insurance guide
• Personal finance
• View all personal finance
• Small business
• Small business guide
• View all taxes

You’re our first priority. Every time.

We believe everyone should be able to make financial decisions with confidence. And while our site doesn’t feature every company or financial product available on the market, we’re proud that the guidance we offer, the information we provide and the tools we create are objective, independent, straightforward — and free.

So how do we make money? Our partners compensate us. This may influence which products we review and write about (and where those products appear on the site), but it in no way affects our recommendations or advice, which are grounded in thousands of hours of research. Our partners cannot pay us to guarantee favorable reviews of their products or services. Here is a list of our partners .

How to Write a Successful Business Plan for a Loan

Many or all of the products featured here are from our partners who compensate us. This influences which products we write about and where and how the product appears on a page. However, this does not influence our evaluations. Our opinions are our own. Here is a list of our partners and here's how we make money .

Table of Contents

What does a loan business plan include?

What lenders look for in a business plan, business plan for loan examples, resources for writing a business plan.

A comprehensive and well-written business plan can be used to persuade lenders that your business is worth investing in and hopefully, improve your chances of getting approved for a small-business loan . Many lenders will ask that you include a business plan along with other documents as part of your loan application.

When writing a business plan for a loan, you’ll want to highlight your abilities, justify your need for capital and prove your ability to repay the debt. 

Here’s everything you need to know to get started.

How much do you need?

with Fundera by NerdWallet

We’ll start with a brief questionnaire to better understand the unique needs of your business.

Once we uncover your personalized matches, our team will consult you on the process moving forward.

A successful business plan for a loan describes your financial goals and how you’ll achieve them. Although business plan components can vary from company to company, there are a few sections that are typically included in most plans.

These sections will help provide lenders with an overview of your business and explain why they should approve you for a loan.  

Executive summary

The executive summary is used to spark interest in your business. It may include high-level information about you, your products and services, your management team, employees, business location and financial details. Your mission statement can be added here as well.

To help build a lender’s confidence in your business, you can also include a concise overview of your growth plans in this section.

Company overview

The company overview is an area to describe the strengths of your business. If you didn’t explain what problems your business will solve in the executive summary, do it here. 

Highlight any experts on your team and what gives you a competitive advantage. You can also include specific details about your business such as when it was founded, your business entity type and history.

Products and services

Use this section to demonstrate the need for what you’re offering. Describe your products and services and explain how customers will benefit from having them. 

Detail any equipment or materials that you need to provide your goods and services — this may be particularly helpful if you’re looking for equipment or inventory financing . You’ll also want to disclose any patents or copyrights in this section.

Market analysis

Here you can demonstrate that you’ve done your homework and showcase your understanding of your industry, current outlook, trends, target market and competitors.

You can add details about your target market that include where you’ll find customers, ways you plan to market to them and how your products and services will be delivered to them.

» MORE: How to write a market analysis for a business plan

Marketing and sales plan

Your marketing and sales plan provides details on how you intend to attract your customers and build a client base. You can also explain the steps involved in the sale and delivery of your product or service.

At a high level, this section should identify your sales goals and how you plan to achieve them — showing a lender how you’re going to make money to repay potential debt.

Operational plan

The operational plan section covers the physical requirements of operating your business on a day-to-day basis. Depending on your type of business, this may include location, facility requirements, equipment, vehicles, inventory needs and supplies. Production goals, timelines, quality control and customer service details may also be included.

Management team

This section illustrates how your business will be organized. You can list the management team, owners, board of directors and consultants with details about their experience and the role they will play at your company. This is also a good place to include an organizational chart .

From this section, a lender should understand why you and your team are qualified to run a business and why they should feel confident lending you money — even if you’re a startup.

Funding request

In this section, you’ll explain the amount of money you’re requesting from the lender and why you need it. You’ll describe how the funds will be used and how you intend to repay the loan.

You may also discuss any funding requirements you anticipate over the next five years and your strategic financial plans for the future.

» Need help writing? Learn about the best business plan software .

Financial statements

When you’re writing a business plan for a loan, this is one of the most important sections. The goal is to use your financial statements to prove to a lender that your business is stable and will be able to repay any potential debt. 

In this section, you’ll want to include three to five years of income statements, cash flow statements and balance sheets. It can also be helpful to include an expense analysis, break-even analysis, capital expenditure budgets, projected income statements and projected cash flow statements. If you have collateral that you could put up to secure a loan, you should list it in this section as well.

If you’re a startup that doesn’t have much historical data to provide, you’ll want to include estimated costs, revenue and any other future projections you may have. Graphs and charts can be useful visual aids here.

In general, the more data you can use to show a lender your financial security, the better.

Finally, if necessary, supporting information and documents can be added in an appendix section. This may include credit histories, resumes, letters of reference, product pictures, licenses, permits, contracts and other legal documents.

Lenders will typically evaluate your loan application based on the five C’s — or characteristics — of credit : character, capacity, capital, conditions and collateral. Although your business plan won't contain everything a lender needs to complete its assessment, the document can highlight your strengths in each of these areas.

A lender will assess your character by reviewing your education, business experience and credit history. This assessment may also be extended to board members and your management team. Highlights of your strengths can be worked into the following sections of your business plan:

Executive summary.

Company overview.

Management team.

Capacity centers on your ability to repay the loan. Lenders will be looking at the revenue you plan to generate, your expenses, cash flow and your loan payment plan. This information can be included in the following sections:

Funding request.

Financial statements.

Capital is the amount of money you have invested in your business. Lenders can use it to judge your financial commitment to the business. You can use any of the following sections to highlight your financial commitment:

Operational plan.

Conditions refers to the purpose and market for your products and services. Lenders will be looking for information such as product demand, competition and industry trends. Information for this can be included in the following sections:

Market analysis.

Products and services.

Marketing and sales plan.

Collateral is an asset pledged to a lender to guarantee the repayment of a loan. This can be equipment, inventory, vehicles or something else of value. Use the following sections to include information on assets:

» MORE: How to get a business loan

Writing a business plan for a loan application can be intimidating, especially when you’re just getting started. It may be helpful to use a business plan template or refer to an existing sample as you’re going through the draft process.

Here are a few examples that you may find useful:

Business Plan Outline — Colorado Small Business Development Center

Business Plan Template — Iowa Small Business Development Center

Writing a Business Plan — Maine Small Business Development Center

Business Plan Workbook — Capital One

Looking for a business loan?

See our overall favorites, or narrow it down by category to find the best options for you.

on NerdWallet's secure site

U.S. Small Business Administration. The SBA offers a free self-paced course on writing a business plan. The course includes several videos, objectives for you to accomplish, as well as worksheets you can complete.

SCORE. SCORE, a nonprofit organization and resource partner of the SBA, offers free assistance that includes a step-by-step downloadable template to help startups create a business plan, and mentors who can review and refine your plan virtually or in person.

Small Business Development Centers. Similarly, your local SBDC can provide assistance with business planning and finding access to capital. These organizations also have virtual and in-person training courses, as well as opportunities to consult with business experts.

Business plan software. Although many business plan software platforms require a subscription, these tools can be useful if you want a templated approach that can break the process down for you step-by-step. Many of these services include a range of examples and templates, instruction videos and guides, and financial dashboards, among other features. You may also be able to use a free trial before committing to one of these software options.

A loan business plan outlines your business’s objectives, products or services, funding needs and finances. The goal of this document is to convince lenders that they should approve you for a business loan.

Not all lenders will require a business plan, but you’ll likely need one for bank and SBA loans. Even if it isn’t required, however, a lean business plan can be used to bolster your loan application.

Lenders ask for a business plan because they want to know that your business is and will continue to be financially stable. They want to know how you make money, spend money and plan to achieve your financial goals. All of this information allows them to assess whether you’ll be able to repay a loan and decide if they should approve your application.

On a similar note...

• Search Search Please fill out this field.

Why Do I Need a Business Plan?

Sections of a business plan, the bottom line.

• Small Business

How to Write a Business Plan for a Loan

How to secure business financing

Matt Webber is an experienced personal finance writer, researcher, and editor. He has published widely on personal finance, marketing, and the impact of technology on contemporary arts and culture.

• How to Start a Business: A Comprehensive Guide and Essential Steps
• How to Do Market Research, Types, and Example
• Marketing Strategy: What It Is, How It Works, How To Create One
• Marketing in Business: Strategies and Types Explained
• What Is a Marketing Plan? Types and How to Write One
• Business Development: Definition, Strategies, Steps & Skills
• Business Plan: What It Is, What's Included, and How to Write One
• Small Business Development Center (SBDC): Meaning, Types, Impact
• How to Write a Business Plan for a Loan CURRENT ARTICLE
• Business Startup Costs: It’s in the Details
• Startup Capital Definition, Types, and Risks
• Bootstrapping Definition, Strategies, and Pros/Cons
• Crowdfunding: What It Is, How It Works, and Popular Websites
• Starting a Business with No Money: How to Begin
• A Comprehensive Guide to Establishing Business Credit
• Equity Financing: What It Is, How It Works, Pros and Cons
• Best Startup Business Loans
• Sole Proprietorship: What It Is, Pros & Cons, and Differences From an LLC
• Partnership: Definition, How It Works, Taxation, and Types
• What is an LLC? Limited Liability Company Structure and Benefits Defined
• Corporation: What It Is and How to Form One
• Starting a Small Business: Your Complete How-to Guide
• Starting an Online Business: A Step-by-Step Guide
• How to Start Your Own Bookkeeping Business: Essential Tips
• How to Start a Successful Dropshipping Business: A Comprehensive Guide

A business plan is a document that explains what a company’s objectives are and how it will achieve them. It contains a road map for the company from a marketing, financial, and operational standpoint. Some business plans are more detailed than others, but they are used by all types of businesses, from large, established companies to small startups.

If you are applying for a business loan , your lender may want to see your business plan. Your plan can prove that you understand your market and your business model and that you are realistic about your goals. Even if you don’t need a business plan to apply for a loan, writing one can improve your chances of securing finance.

Key Takeaways

• Many lenders will require you to write a business plan to support your loan application.
• Though every business plan is different, there are a number of sections that appear in every business plan.
• A good business plan will define your company’s strategic priorities for the coming years and explain how you will try to achieve growth.
• Lenders will assess your plan against the “five Cs”: character, capacity, capital, conditions, and collateral.

There are many reasons why all businesses should have a business plan . A business plan can improve the way that your company operates, but a well-written plan is also invaluable for attracting investment.

On an operational level, a well-written business plan has several advantages. A good plan will explain how a company is going to develop over time and will lay out the risks and contingencies that it may encounter along the way.

A business plan can act as a valuable strategic guide, reminding executives of their long-term goals amid the chaos of day-to-day business. It also allows businesses to measure their own success—without a plan, it can be difficult to determine whether a business is moving in the right direction.

A business plan is also valuable when it comes to dealing with external organizations. Indeed, banks and venture capital firms often require a viable business plan before considering whether they’ll provide capital to new businesses.

Even if a business is well-established, lenders may want to see a solid business plan before providing financing. Lenders want to reduce their risk, so they want to see that a business has a serious and realistic plan in place to generate income and repay the loan.

Every business is different, and so is every business plan. Nevertheless, most business plans contain a number of generic sections. Common sections are: executive summary, company overview, products and services, market analysis, marketing and sales plan, operational plan, and management team. If you are applying for a loan, you should also include a funding request and financial statements.

Let’s look at each section in more detail.

Executive Summary

The executive summary is a summary of the information in the rest of your business plan, but it’s also where you can create interest in your business.

You should include basic information about your business, including what you do, where you are based, your products, and how long you’ve been in business. You can also mention what inspired you to start your business, your key successes so far, and your growth plans.

Company Overview

In this section, focus on the core strengths of your business, the problem you want to solve, and how you plan to address it.

Here, you should also mention any key advantages that your business has over your competitors, whether this is operating in a new market or a unique approach to an existing one. You should also include key statistics in this section, such as your annual turnover and number of employees.

Products and Services

In this section, provide some details of what you sell. A lender doesn’t need to know all the technical details of your products but will want to see that they are desirable.

You can also include information on how you make your products, or how you provide your services. This information will be useful to a lender if you are looking for financing to grow your business.

Market Analysis

A market analysis is a core section of your business plan. Here, you need to demonstrate that you understand the market you are operating in, and how you are different from your competitors. If you can find statistics on your market, and particularly on how it is projected to grow over the next few years, put them in this section.

Marketing and Sales Plan

Your marketing and sales plan gives details on what kind of new customers you are looking to attract, and how you are going to connect with them. This section should contain your sales goals and link these to marketing or advertising that you are planning.

If you are looking to expand into a new market, or to reach customers that you haven’t before, you should explain the risks and opportunities of doing so.

Operational Plan

This section explains the basic requirements of running your business on a day-to-day basis. Your exact requirements will vary depending on the type of business you run, but be as specific as possible.

If you need to rent office space, for example, you should include the cost in your operational plan. You should also include the cost of staff, equipment, and any raw materials required to run your business.

Management Team

The management team section is one of the most important sections in your business plan if you are applying for a loan. Your lender will want reassurance that you have a skilled, experienced, competent, and reliable senior management team in place.

Even if you have a small team, you should explain what makes each person qualified for their position. If you have a large team, you should include an organizational chart to explain how your team is structured.

Funding Request

If you are applying for a loan, you should add a funding request. This is where you explain how much money you are looking to borrow, and explain in detail how you are going to use it.

The most important part of the funding-request section is to explain how the loan you are asking for would improve the profitability of your business, and therefore allow you to repay your loan.

Financial Statements

Most lenders will also ask you to provide evidence of your business finances as part of your application. Graphs and charts are often a useful addition to this section, because they allow your lender to understand your finances at a glance.

The overall goal of providing financial statements is to show that your business is profitable and stable. Include three to five years of income statements, cash flow statements, and balance sheets. It can also be useful to provide further analysis, as well as projections of how your business will grow in the coming years.

What Do Lenders Look for in a Business Plan?

Lenders want to see that your business is stable, that you understand the market you are operating in, and that you have realistic plans for growth.

Your lender will base their decision on what are known as the “five Cs.” These are:

• Character : You can stress your good character in your executive summary, company overview, and your management team section.
• Capacity : This is, essentially, your ability to repay the loan. Your lender will look at your growth plans, your funding request, and your financial statements in order to assess this.
• Capital : This is the amount of money you already have in your business. The larger and more established your business is, the more likely you are to be approved for finance, so highlight your capital throughout your business plan.
• Conditions : Conditions refer to market conditions. In your market analysis, you should be able to prove that your business is well-positioned in relation to your target market and competitors.
• Collateral : Depending on your loan, you may be asked to provide collateral , so you should provide information on the assets you own in your operational plan.

How Long Does It Take to Write a Business Plan?

The length of time it takes to write a business plan depends on your business, but you should take your time to ensure it is thorough and correct. A business plan has advantages beyond applying for a loan, providing a strategic focus for your business.

What Should You Avoid When Writing a Business Plan?

The most common mistake that business owners make when writing a business plan is to be unrealistic about their growth potential. Your lender is likely to spot overly optimistic growth projections, so try to keep it reasonable.

Should I Hire Someone to Write a Business Plan for My Business?

You can hire someone to write a business plan for your business, but it can often be better to write it yourself. You are likely to understand your business better than an external consultant.

Writing a business plan can benefit your business, whether you are applying for a loan or not. A good business plan can help you develop strategic priorities and stick to them. It describes how you are going to grow your business, which can be valuable to lenders, who will want to see that you are able to repay a loan that you are applying for.

U.S. Small Business Administration. “ Write Your Business Plan .”

U.S. Small Business Administration. “ Market Research and Competitive Analysis .”

U.S. Small Business Administration. “ Fund Your Business .”

Navy Federal Credit Union. “ The 5 Cs of Credit .”

• Terms of Service
• Editorial Policy
• Privacy Policy
• Your Privacy Choices

• AI ASSISTANTS

Upmetrics AI Your go-to AI-powered business assistant

AI Writing Assist Write, translate, and refine your text with AI

AI Financial Assist Automated forecasts and AI recommendations

• TOP FEATURES

AI Business Plan Generator Create business plans faster with AI

Financial Forecasting Make accurate financial forecasts faster

Strategic Planning Develop actionable strategic plans on-the-go

AI Pitch Deck Generator Use AI to generate your investor deck

See how it works  →

AI-powered business planning software

Very useful business plan software connected to AI. Saved a lot of time, money and energy. Their team is highly skilled and always here to help.

- Julien López

• BY USE CASE

Starting & Launching a Business Plan your business for launch and success

Validate Your Business Idea Discover the potential of your business idea

Secure Funding, Loans, Grants Create plans that get you funded

Business Consultant & Advisors Plan with your team members and clients

Business Schools & Educators Simplify business plan education for students

Students & Learners Your e-tutor for business planning

• Sample Plans
• WHY UPMETRICS?

Reviews See why customers love Upmetrics

Customer Success Stories Read our customer success stories

Blogs Latest business planning tips and strategies

Strategic Planning Templates Ready-to-use strategic plan templates

Business Plan Course A step-by-step business planning course

Ebooks & Guides A free resource hub on business planning

Business Tools Free business tools to help you grow

• 400+ Sample Business Plans

How to Write a Professional Business Plan for a Loan

• March 27, 2024

11 Min Read

So, are you thinking of getting a loan or funding to start an exciting business journey?

That’s great! But before you go any further, it’s very important to have a solid business plan in place.

Well, we understand that creating a successful plan for a loan can be a daunting task. That’s why we’re here to help you!

This investment-ready business plan template for loans will help you include all the essential elements in your plan, from summarizing your business concept to projecting the financial data. It not only impresses business loan lenders but also sets the stage for success.

Ready to get started? Let’s first understand how business plans will help you with loan proposals.

How business plans help in loan applications?

A business plan is a professional document that serves as a written loan proposal if you want to secure a loan for capital investment. It details every aspect of your business, including its concept, goals, market opportunity, and financial data.

Whether you’re a new entrepreneur or a small business owner, you’ll need a well-prepared business plan. It helps you persuade potential investors or lenders of its viability and potential for success.

Here are a few primary reasons why business plans are necessary in loan applications:

It helps you showcase your vision

A well-written business plan communicates your business vision effectively and allows you to demonstrate your clarity of purpose and strategic direction. It offers lenders a compelling narrative of what your business is aimed for and how it will achieve its goals.

It helps you prove your financial feasibility

Well, lenders need assurance that they’re making a wise investment. A detailed business plan presents them with realistic financial projections, along with how your business will earn money and repay the loan. This infuses confidence in lenders and convinces them that your business is a safe bet.

It helps you mitigate potential risks

Once you start your business, it naturally involves fair enough risks. However, a good business plan clarifies that you’re aware of those challenges and have backup plans or strategies to mitigate them. This shows lenders that you’ve considered different situations and keep contingency plans in place.

It helps you demonstrate your preparedness

A business plan shows lenders that you’ve carefully outlined every aspect of your business—from conducting market analysis to predicting finances. It assures that you’re serious about your business and well-prepared to manage the ups and downs of starting a business.

In short, having a solid business plan can be the cornerstone of a successful loan application that explains your business idea and how you plan to utilize the loan money to get started.

Now that you know how business plans help in a loan application, it’s time to check out and understand the key elements of a business plan for a loan template.

Say goodbye to boring templates

Build your business plan faster and easier with AI assistant

Plans starting from $7/month

Key components of a successful business plan for a loan

1. executive summary.

An executive summary is the first section of the plan, providing a concise overview of the entire business plan.

Generally, it is written in the last, as it summarizes the most important components you mentioned in your plan.

Since the potential investors or lenders would read this section first, make sure that you keep it simple, crisp, and compelling to build their confidence in your business. Also, it should not be more than 1 or 2 pages.

You may write your executive summary with a precise explanation of your business concept, the type of business you operate, and its status.

Here are a few primary elements you must add to your summary:

• Your company’s mission statement
• The product or service you intend to offer
• Market Opportunity
• Management team’s background and experience
• Growth plans or long-term objectives
• Financial projections and funding needs

2. Company Overview

As you’ll give a brief introduction in the executive summary, this chapter will expand on it, providing an in-depth understanding of your business.

Company description includes all the business-related facts, such as the startup concept, vision-mission statements, company location, etc. Also, it explains the problems or challenges you aim to solve.

In addition to that, consider answering a few questions that would help lenders to grasp the significance of your business:

• What is the legal structure of your business?
• Who is the business owner?
• Do you have any business partners?
• Why did you start this business, and when it was founded?
• What are your business accomplishments to date?
• Who will get benefits from your company’s product or service?

Note that the company overview section can be regarded as your extended elevator pitch.

So, it’s a good opportunity to present your business’s specific details and structural aspects that the financing partner needs to know.

3. Market Analysis

The market analysis section provides readers with a deep understanding of the specific industry or market in which you plan to serve.

This seems unnecessary but serves different purposes. Those who are looking to fund a franchise business should do some serious work for this section, as lenders will review it very closely.

To carefully draft this section, you should conduct thorough market research and industry analysis to define your target customers, industry trends, market demand, and competitors.

This will demonstrate that you understand the market dynamics and validate the demand for your products or services.

Here are a few elements you should include in your market analysis section:

• Ideal target market
• Market size and growth potential
• Customer segments
• Competitive analysis
• Emerging trends
• Applicable government regulations

4. Product or Service Offerings

In this section, you may provide a detailed description of your products and service offerings, along with their features, benefits, and pricing structure.

It helps you highlight what your business offers to its ideal customers, how your offerings will satisfy their needs and explains the value proposition of your products or services.

You may consider including these points in the product or service section:

• A brief description of your product & service
• Pricing details
• Intellectual property, copyright, and patent filings
• Quality measures
• Any additional offerings

5. Sales and Marketing Strategies

Your marketing and sales plan elucidates how you intend to market your products or services in greater detail. It helps you outline the marketing and sales strategies you’ll use to attract and retain potential customers.

The primary goal is to give a flexible and practical marketing and sales strategy that persuades the lenders you know how to advertise or develop a public relations campaign to reach the company’s revenue goals.

For a well-crafted marketing plan, you might consider adding the following details in your plan:

• Your target audience and brand positioning
• Detailed marketing strategy
• Sales and marketing goals and KPIs
• Sales and marketing budgets
• Customer retention plan

While reviewing your loan application, lenders would like to know how you plan to make money and how you overcome marketing and sales challenges, so ensure that this strategy is always relevant.

6. Operations Plan

The operations plan section provides a clear picture of your company’s day-to-day operations and activities. It is a detailed-oriented section that outlines how you’ll manage to run your business smoothly.

Also, operational excellence is necessary to achieve your goals, satisfy client commitments, and maximize results. So, try to mention your operational intricacies and showcase efficient systems and processes.

Here are a list of details you must include in your operations plan:

• Staffing & training
• Operational processes
• Inventory needs and supplies
• facilities & technology
• Regulatory compliance

By offering insights into these operational aspects, this section helps you instill confidence in lenders about your ability to effectively handle and grow your company.

7. Management Team

Your management team section introduces the key individuals who are responsible for driving your business ahead.

It helps lenders easily understand your team’s roles & responsibilities, educational qualifications, industry experience, and how you plan to compensate your leadership team.

Even this will assure lenders that your team is capable enough to navigate challenges, make informed decisions, and reach strategic objectives. Also, they feel confident giving you a loan—even if it’s your startup.

So, you may consider including the below information:

• Company owner profile
• Resume-styled summary of key executives
• Organizational chart
• Compensation plan
• Details of advisory board members(if any)

8. Financial Plan

A well-written and comprehensive financial plan is one of the most crucial sections of your plan, as it helps you prove to lenders your business’s financial health, growth potential, and ability to repay the business loan.

So, your financial analysis must include the projected financial statements for three years or more. The following are the key financial projections that you should add:

• Income statements
• Cash flow statements
• Capital expenditure budgets
• Balance sheet
• Break-even analysis
• Funding requirements

As well as you should also list hard or soft collateral if you possess it so that you can put it up to get a loan. Even lenders may request to add more granular data(such as cost of sales or cost per product/service).

Note that if you’re a startup and don’t carry enough data to highlight, consider including estimated costs, revenue streams, and other strategic future projections you may have.

9. Appendix

The appendix is the last section of a professional business plan that typically provides supplementary information and other supporting documents the lender may need for better understanding.

You may include the following details in an appendix:

• Business licenses and permits
• Contractual agreements or other legal documents
• Letters of reference
• Credit histories and tax returns
• Key managers’ resumes and certificates
• Product photos

By adding these details, you offer more detailed explanations or validation for your business plan, strengthening your discussions and claims.

What factors do lenders look for in a business plan

When you submit a business plan to secure funding, lenders will analyze it to evaluate the viability and creditworthiness of your loan application. Here are several key factors they look for:

Character of your management team

Lenders will assess a business’ character that includes subjective or intangible qualities like whether its owners or key executives are perceived as honest, competent, or committed. Also, they consider educational background, industry experience, skills, leadership capabilities, and credit histories. This can be critical for evaluating prospects as most lenders don’t wish to lend to whom they don’t feel trustworthy.

Your capability to repay loans

Loan officers also spend a lot of time analyzing the borrower’s ability to repay the loan. They will thoroughly examine the financial statements such as projected revenue, expenses, cash flows, growth plans, and loan payments. Further, lenders analyze the financial history to see how much revenue you have generated or how much profit you have made in the past.

The capital amount you’re seeking

While reviewing loan applications, lenders will go through your financial information that highlights how much funding you’re seeking, how much cash you carry on hand, and how much debt you have. Also, they assess your personal financial investments as a sign of commitment and seriousness. So, make sure your business plan clearly outlines your investment amount and funding needs.

Collateral or personal guarantees

In some cases, lenders may request collateral or personal guarantees to secure the loan. Thus, you should document any assets or valuable items you can offer as collateral or additional security. Even lenders may still approve your loan without collateral if you have a good credit history and a reliable business plan.

By understanding these key considerations, you can prepare a business plan that resonates with the lender’s interests and concerns. Now, let’s move to a few business plan examples for a loan.

Business plan examples for a loan

When you’re just venturing into your entrepreneurship journey, crafting a comprehensive business plan for a loan application can be overwhelming.

So, try to consider some sample business plan templates or resources to get started on the first draft of your plan. Here are a few business plan examples that you may find helpful:

• Sample business plan outline
• Small business plan template
• Comprehensive business plan writing
• Business Plan Workbook for Loan Applications

Start preparing your business plan

Finally, you understand the importance and key elements of drafting a business plan for securing a loan or funding. But it requires some extra effort to find success down the road.

If you’re still confused about where to start, Upmetrics could be a great choice. It’s a modern business plan app that helps entrepreneurs or small business owners create an actionable plan quickly.

With Upmetrics, you’ll get easy-to-follow guides, a library of business plan templates , AI support, a financial forecasting tool, and other valuable resources to streamline your entire business planning approach.

So, don’t wait and start preparing your business plan for a loan!

Build your Business Plan Faster

with step-by-step Guidance & AI Assistance.

Frequently Asked Questions

Do i need a business plan to get a loan.

Of course, most lenders or financial institutes require a solid business plan, even if you are a well-established business. A well-crafted business plan helps you highlight every essential information about your business and demonstrate to lenders that you have a realistic plan in place to generate income and repay the loan.

Can I write a business plan myself?

Definitely, you can write a business plan by yourself. Also, you can get help from various resources available, including business plan templates and guides, to create a comprehensive plan. But, if you’re unsure or need assistance, you may consider having a business plan software or hiring a professional writer.

How long should my business plan be?

The length of your business plan should be concise and focused, typically depending on its purpose. A one-page business plan is a single-page document, a lean or mini business plan comprises 1–10 pages, while a comprehensive business plan can range from 15 to 35 pages and beyond.

What's the most important element of a loan-seeking business plan?

The financial plan is the most crucial element of a loan-seeking business plan, as lenders want to check realistic and well-structured financial forecasts that present your ability to repay the loan. Also, this section can make or break a lender’s confidence and willingness to raise capital.

What format should I use?

It’s essential to select a format that can effectively convey your business idea, strategy, and financial projections to the lenders. Following are a few common options to consider:

• Traditional text-based document
• PowerPoint or Keynote presentation deck
• Executive summary or a pitch deck

So, whatever format you choose, it should align with your preferences, the lender requirements, and the complexity of your business.

About the Author

Upmetrics Team

Upmetrics is the #1 business planning software that helps entrepreneurs and business owners create investment-ready business plans using AI. We regularly share business planning insights on our blog. Check out the Upmetrics blog for such interesting reads. Read more

Reach Your Goals with Accurate Planning

No Risk – Cancel at Any Time – 15 Day Money Back Guarantee

Popular Templates

What stage is your business at?

Tell us and we’ll match you with a special LivePlan discount:

New Business Idea

Startup Phase

Established Business

Enter your email address to unlock it.

Please enter a valid email address

We care about your privacy. See our Privacy Policy .

How To Write A Business Plan for A Bank Loan (3 Key Steps)

Wondering how to create a business plan that will wow your banker.

You're not alone.

Most entrepreneurs see writing a business plan as a gargantuan task – especially if they've never written one before.

Where do you start?

How do you calculate the financials?

How can you be sure you're not making a mistake?

And if you need a business plan for a bank loan, getting this document right is absolutely essential.

So here's what we recommend: simplify the planning process by breaking the work up into manageable, bite–sized steps. That way, you can focus on one section at a time to make sure it's accurate.

Here's a quick overview of the step–by–step process we guide entrepreneurs through when they sign up for LivePlan.

Step 1: Outline The Opportunity

This is the core of your business plan. It should give loan officers a clear understanding of:

• What problem you're solving
• How your product or service fits into the current market
• What sets your business apart from the competition

There are three key parts to this step:

The Problem & Solution

Detail exactly what problem you are solving for your customers. How do their lives improve after you solve that “pain point” for them?

We recommend actually going out and chatting with your target audience first. That way, you can validate that you're solving a real problem for your potential customers.

Be sure to describe your solution in vivid detail. For example, if the problem is that parking downtown is expensive and hard to find, your solution might be a bike rental service with designated pickup and dropoff locations.

Target Market

Who exactly are you selling to? And roughly how many of them are there?

This is crucial information for determining whether or not your business will succeed long–term. Never assume that your target market is “everyone.”

For example, it would be easy for a barber shop to target everyone who needs a haircut. But most likely, it will need to focus on a specific market segment to reach its full business potential. This might include catering to children and families, seniors or business professionals.

Competition

Who are your direct competitors? These are companies that provide similar solutions that aim to solve your customers' pain points.

Then outline what your competitive advantages are. Why should your target market choose you over the other products or services available?

Think you don't have any competition? Think again. Your customers are likely turning to an indirect competitor that is solving their problem with a different type of solution.

For example: A taco stand might compete directly with another taco stand, but indirectly with a nearby hot dog vendor.

Boost your chances of securing a loan

See how LivePlan can help you write a fundable business plan

Step 2: Show how you'll execute

This is where the action happens! Here you'll get into the details of how you'll take advantage of the opportunity you outlined in the previous section. This part demonstrates to banks that you have a strong plan to achieve success.

The three main components of this step include:

Marketing & Sales Plan

There can be a lot of moving parts to this one, depending on your business model.

But most importantly, you'll need to fully explain how you plan to reach your target market and convert those people into customers. A few example of what should be included:

• Positioning strategy. What makes your business both unique and highly desirable to your target market?
• Marketing activities. Will you advertise with billboards, online ads or something else entirely?
• Pricing. What you charge must reflect consumer demand. There are a few models to choose from, including ‘cost–plus pricing’ and ‘value pricing.’

This is the nuts and bolts of your business. It's especially important for brick–and–mortar companies that operate a storefront or have a warehouse.

You may want to explain why your location is important or detail how much space you have available. Plan to work at home? You can also cover your office space and any plans to move outside your house.

Any specialized software or equipment and tools should also be covered here.

Milestones & Metrics

Lenders and investors want to be confident that you know how to turn your business plans into financial success. That's where your milestones come in.

These are planned goals that help you progress your company. For example, if you're launching a new product your milestones may include completing prototypes and figuring out manufacturing.

Metrics are how you will gauge the success of your business. Do you want to generate a certain level of sales? Or keep costs at a certain level? Figuring out which metrics are most important and then tracking them is essential for growth.

Step 3: Detail your financial plan

This is the most crucial – and intimidating – part of any business plan for a bank loan. Your prospective lender will look especially close at this section to determine how likely your business is to succeed.

But the financial section doesn't have to be overwhelming, especially if you break the work into smaller pieces. Here are 3 items that your plan must have:

Simply put, this is your projections for your business finances. It gives you (and the bank) an idea of how much profit your company stands to make. Just a few items you'll need to include:

• Revenue. List all your products, services and any other ways your business will generate income.
• Direct costs. Or in other words, what are the costs to make what you sell?
• Personnel. Salaries and expenses related to what you pay yourself, employees and any contactors.
• Expenses. Things like rent, utilities, marketing costs and any other regular expenses.

Exactly how will you use any investments, loans or other financing to grow your business? This might include paying for capital expenses like equipment or hiring personnel.

Also detail where all your financing is coming from. Lines of credit, loans or personal savings should be listed here.

Bankers will be giving this section a lot of attention. Here's what you'll need:

• Profit & Loss. This statement pulls in numbers from your sales forecast and other elements to show whether you're making or losing money.
• Projected Balance Sheet. This is likely the first thing a loan officer will look at: it covers your liability, capital and assets. It provides an overview of how financially sound your business is.
• Projected Cash Flow. Essentially, this statement keeps track of how much money you have in the bank at any given point. Loan officers are likely to expect realistic monthly cash flow for the next 12 months.

Don't forget the Executive Summary

The Executive Summary is the first section of your business plan, but we recommend you tackle it last.

It's basically an introduction to your company, summarizing the main points of your plan. Keep it to just one or two pages and be as clear and concise as possible.

Think of it as a quick read designed to get the lender excited about your business.

If you need help writing your plan

Not everyone feels confident writing a business plan themselves, especially if it's needed to secure a bank loan.

And although you don't need an MBA to write one, getting your business plan right often does require quite a bit of work. So if you need help writing your plan, here are two options to consider:

• Hire a professional business plan writer to do it for you. This is typically the most expensive route, but worth it if you're pursuing $100,000 or more in capital.
• Sign up for LivePlan. It's business planning software that walks you through a step–by–step process for writing any type of plan. It's an affordable option that also gives you an easy way to track your actuals against your business plan, so you can get the insights you need to grow faster.

LivePlan makes it easy to write a winning business plan

No risk – includes our 35-day money back guarantee.

• Mar 30, 2023

The Ultimate Guide to Writing a Business Plan for a Loan: A Step-by-Step Walk-Through

The Ultimate Guide to Writing a Business Plan for a Loan: A Step-by-Step Walkthrough

As a business plan specialist and expert business planner, I'm here to guide you through the process of writing a comprehensive business plan for securing a loan. Whether you're a start-up or an established business looking to expand, a well-crafted business plan is essential for impressing potential lenders and securing the funding you need.

In this extensive, 5,000-word article, I'll cover everything you need to know about creating a top-notch business plan that will boost your chances of loan approval. We'll go through each section in detail, providing you with practical examples and tips to optimize your plan for success. So, let's get started!

Executive Summary

The executive summary is the first and most critical section of your business plan. It's a brief overview of your entire plan, highlighting the key points and giving readers an insight into your business.

Key elements to include in your executive summary:

Business concept: Briefly explain your business idea, the products or services you plan to offer, and the target market.

Company overview: Provide essential information about your company, including its legal structure, location, and mission statement.

Management team: Showcase the expertise and experience of your management team, emphasizing their ability to lead the business.

Market opportunity: Describe the market demand, trends, and target audience, highlighting the opportunity for your business to succeed.

Financial highlights: Summarize your financial projections, including sales, profits, and cash flow.

Loan purpose: Clearly state the purpose of the loan and the amount you're seeking.

Remember, the executive summary is often the first thing lenders read, so make it engaging and informative to grab their attention.

Company Description

The company description section is where you provide a more in-depth look at your business. It should give readers a clear understanding of your company's purpose, goals, and competitive advantages.

Key elements to include in your company description:

Business history: If your company has an existing history, briefly describe its origins and milestones achieved.

Mission statement: Articulate the purpose of your company and the value you aim to provide to customers.

Objectives: Outline the specific goals you want to achieve with your business, both short-term and long-term.

Products and services: Provide a detailed description of the products or services you plan to offer, emphasizing the benefits they provide to customers.

Target market: Identify your target audience, specifying their demographics, psychographics, and buying habits.

Competitive advantage: Explain what sets your business apart from the competition and how you plan to maintain this edge.

Market Analysis

The market analysis section demonstrates your understanding of the industry, market, and competition. It's crucial to show lenders that you've done your homework and have a comprehensive understanding of the market landscape.

Key elements to include in your market analysis:

Industry overview: Provide a high-level view of your industry, including its size, growth trends, and key players.

Market segmentation: Break down your target market into smaller segments, identifying their unique needs and preferences.

Target market characteristics: Describe the specific characteristics of your target market, such as demographics, psychographics, and geographic location.

Market demand: Present evidence of market demand, using data on customer needs, market trends, and buying behaviors.

Competitor analysis: Evaluate your main competitors, analyzing their strengths, weaknesses, and market share.

SWOT analysis: Conduct a SWOT analysis (Strengths, Weaknesses, Opportunities, and Threats) to assess your business's position in the market.

Marketing and Sales Strategy

In this section, outline your marketing and sales strategy to show lenders how you plan to attract and retain customers, as well as generate revenue. A well-defined marketing and sales strategy is crucial to demonstrate that you have a clear plan for growth and profitability.

Key elements to include in your marketing and sales strategy:

Marketing objectives: Define your marketing goals, such as brand awareness, lead generation, or customer retention.

Target audience: Reiterate your target market, emphasizing their needs and preferences.

Unique selling proposition (USP): Highlight your USP, the main reason customers should choose your products or services over the competition.

Marketing channels: Identify the marketing channels you plan to use, such as social media, email, content marketing, or paid advertising. Explain the rationale behind your choice of channels and how they align with your target audience.

Sales process: Describe your sales process, from lead generation to closing deals. Include details on your sales team structure, training, and compensation plans.

Key performance indicators (KPIs): List the KPIs you'll use to measure the success of your marketing and sales efforts, such as conversion rates, average deal size, or customer lifetime value.

Operations Plan

The operations plan section details the day-to-day activities required to run your business. It shows lenders that you have a clear understanding of the operational aspects of your company and the resources needed to support your growth.

Key elements to include in your operations plan:

Facilities: Describe your business's physical location, including its size, layout, and any equipment or machinery required.

Production process: If applicable, detail your production process, including the steps involved, quality control measures, and production capacity.

Supply chain: Outline your supply chain, identifying key suppliers, procurement processes, and inventory management practices.

Staffing: Explain your staffing requirements, including the roles, responsibilities, and qualifications of each team member.

Management structure: Provide an organizational chart, showcasing your company's management structure and reporting lines.

Legal and regulatory requirements: Identify any relevant legal or regulatory requirements, such as licenses, permits, or certifications needed to operate your business.

Financial Plan

The financial plan is arguably the most crucial section of your business plan when applying for a loan. It demonstrates your ability to manage finances, make informed decisions, and, ultimately, repay the loan.

Key elements to include in your financial plan:

Revenue projections: Estimate your future sales, breaking them down by product or service category and showing growth rates over time.

Expense projections: Forecast your expenses, including fixed costs (e.g., rent, utilities) and variable costs (e.g., marketing, salaries).

Cash flow statement: Provide a detailed cash flow statement, showing how cash will flow in and out of your business over a specified period (typically 12 months).

Profit and loss statement: Create a profit and loss statement that projects your business's profitability over time.

Balance sheet: Prepare a balance sheet that showcases your business's assets, liabilities, and equity.

Break-even analysis: Calculate the point at which your business will break even, meaning your revenues equal your expenses.

Loan repayment schedule: Detail your proposed loan repayment schedule, including the loan amount, interest rate, repayment terms, and projected date of full repayment.

The appendices section is where you can include any additional documents or supporting materials that are relevant to your business plan. These documents may provide further evidence of your company's viability and help strengthen your case for securing a loan.

Examples of items to include in the appendices:

Resumes of key team members

Product samples or prototypes

Market research data or surveys

Letters of intent or contracts with suppliers, partners, or customers

Intellectual property documentation, such as patents, trademarks, or copyrights

Relevant licenses, permits, or certifications

Writing a comprehensive business plan for a loan can seem like a daunting task, but with the right approach and guidance, it's an achievable goal. By following the step-by-step instructions outlined in this article, you can create a well-structured, persuasive business plan that will greatly improve your chances of securing the funding you need. Remember to:

Pay close attention to your executive summary, as it sets the tone for the entire plan.

Be thorough and detailed in your market analysis, showing a deep understanding of your industry and target audience.

Develop a solid marketing and sales strategy to demonstrate your ability to attract and retain customers.

Address the operational aspects of your business, including staffing, facilities, and supply chain management.

Present a robust financial plan, complete with projections and a loan repayment schedule.

By doing so, you'll showcase your expertise, commitment, and preparedness to potential lenders, significantly increasing the likelihood of obtaining the loan your business needs to grow and succeed.

In addition to following the steps outlined in this guide, consider seeking professional assistance from a business plan consultant or specialist to review and refine your plan. Their expertise can help you identify any areas that may need improvement and ensure that your business plan is optimized for success.

Finally, remember to continuously update your business plan as your business evolves. Regular updates will ensure that your plan remains relevant and accurate, providing you with a valuable roadmap for your business's future growth and development.

With dedication, persistence, and a well-crafted business plan, you can secure the funding you need to bring your business vision to life. Good luck, and here's to your success!

• Writing Your Business Plan
• Funding Your Business

Recent Posts

The Five Most Frequently Asked Questions About Business Loans

The Five Most Frequently Asked Questions About Startup Funding

The Ultimate Cheat Sheet: Business Plan Writing Tips & Tricks

How to Simply Write a Business Plan for a Loan

• Small Business
• Business Planning & Strategy
• Help in Writing a Business Plan
• ')" data-event="social share" data-info="Pinterest" aria-label="Share on Pinterest">
• ')" data-event="social share" data-info="Reddit" aria-label="Share on Reddit">
• ')" data-event="social share" data-info="Flipboard" aria-label="Share on Flipboard">

What Are the Main Purposes of a Business Plan?

How to write a comprehensive business plan, how to use facebook notes for your business page.

• Importance of Following a Business Plan
• What Does Writing Paragraphs in Business Format Mean?

When you are a small business owner heading off to ask the bank for a small business loan, one of the first documents the loan officer typically asks for is the business plan. Therefore, it is important to know how to simply write a business plan for a loan. A viable business plan illustrates to the loan officer that you have organized your thoughts and gone through the process of thinking the business out. You can write a business plan simply and quickly if you gather your information and assemble it in a logical manner.

Company Description and Strategy

Explain how you started your business and any evolutions the business has gone through since it began. Typically, the business description is about one page and describes where your business started, the reason it exists and gives a glimpse of which direction you want to move in.

Organization and Management

List out each of the managers involved in the business. Provide a professional biography for each manager and fully describe their role in your business. Also, mention any positive contributions the experience and knowledge of each manager has brought to starting and growing your business.

Service or Product Line

Describe the products or services you are selling. Include a full description of each product or service you offer your customers and prospective customers.

Marketing Strategies

Describe the marketing strategies you intend to implement to bring awareness of your products or services to your target audience. Include online and offline strategies, such as employing a public relations campaign for your monthly business events and placing banners on the websites of professional groups that your target audience belongs to.

Financial Sales and Expense Projections

Once you paint a picture of what business you are in and who the company serves, it is time to show the loan officer the financial picture. Provide financial sales projections and expenses for at least three to five years. Be conservative and truthful when making these projections.

Executive Summary and Overview

Even though the executive summary is the first part of a business plan and one of the most important parts, you may want to write it last because it is an overview of everything the business plan contains. Since you may not have the full picture until after you have compiled the plan, it is usually best to write this page last. The executive summary contains a description of your business goals and the strategies you intend to employ to achieve your goals and should be compelling enough to interest a bank loan officer into wanting to read the rest of the plan and consider giving you the loan.

Create a Cover Page

After you place the executive summary as the first page, create a cover page that includes the title “Business Plan” centered in the middle of the page and the contact information for the business in block format in the bottom left corner of the page. Include the business name, address, phone number, website and email address.

• BPlans.com: Sample Business Plans

Kristie Lorette started writing professionally in 1996. She earned her Bachelor of Science degree in marketing and multinational business from Florida State University and a Master of Business Administration from Nova Southeastern University. Her work has appeared online at Bill Savings, Money Smart Life and Mortgage Loan.

Related Articles

Why is an effective business plan introduction important, what does "abridged" mean on a business plan, how to create a business plan as an entrepreneur, what is an executive summary business plan, how to format a business plan in writing, how to write a letter from the staff of a company to a bank requesting a loan, how to write your business proposal, how to show accounts receivable used as collateral, final summary for a marketing plan, most popular.

• 1 Why Is an Effective Business Plan Introduction Important?
• 2 What Does "Abridged" Mean on a Business Plan?
• 3 How to Create a Business Plan as an Entrepreneur
• 4 What Is an Executive Summary Business Plan?

Financing | Templates

How To Write an SBA Business Plan [+Free Template]

Published June 13, 2023

Published Jun 13, 2023

REVIEWED BY: Tricia Jones

WRITTEN BY: Andrew Wan

This article is part of a larger series on Business Financing .

• 1. Write the Company Description
• 2. Identify Organization & Management
• 3. Specify the Market Analysis
• 4. Write Descriptions of the Products or Services
• 5. Indicate the Marketing & Sales Strategy
• 6. List Financial Data & Projections
• 7. Write the Financing Request
• 8. Fill In the Appendix & Supplemental Information
• 9. Complete the Executive Summary
• Additional Resources

Bottom Line

FILE TO DOWNLOAD OR INTEGRATE

SBA Business Plan Template Download

Thank you for downloading!

If you’re applying for a loan from the Small Business Administration (SBA), there’s a good chance that you’ll need a business plan to get approved. An SBA business plan provides a summary of the various aspects of your business, and we will guide you through the process of creating it, from writing your company description and marketing and sales strategies to completing financial data and projections and your executive summary.

Although there is no standard format, and to help you ensure nothing is overlooked, you can use our SBA business plan template above to ensure you cover the most important areas of your company. A well-prepared business plan can improve your chances of getting an SBA loan.

Step 1: Write the Company Description

This section should contain information about the purpose of your business. It should include a description of the problem or challenge your product or service aims to solve and what types of individuals or organizations will benefit.

A strong company description should also address the following questions:

• Why does your company exist?
• What problems does your business aim to address?
• What prompted you to start your business?
• What organizations or individuals will benefit from your company’s product or service?
• What makes your company different from others?
• What competitive advantages does your business offer?
• What would a successful product launch look like?
• Does your company have strategic partnerships with other vendors?

Step 2: Identify Organization & Management

Details about the legal and tax structure of your business should be included in this section. It can also be helpful to include an organizational chart of your company. You can include information about each team member’s background and experience and how it is relevant to your company:

• Highlight what business structure you have selected and why. Examples commonly include a sole proprietorship, limited liability company (LLC), partnership, S corporation (S-corp), and C corporation (C-corp)
• Include an organizational chart showing which team members are responsible for the various aspects of your company
• You can include resumes for members of your leadership team highlighting their experience and background

Step 3: Specify the Market Analysis

The market analysis section of your SBA business plan should look at who your competitors will be. Look at what they are doing well, what their weaknesses are, and how your company compares.

The SBA’s market analysis page contains information on how you can approach this. Questions you should also consider addressing should include:

• Who are the major competitors in the market?
• What are competitors doing well and are there areas for improvement?
• How does your company compare to the top competitors?
• How has the product or service evolved over time?
• Are there any trends for supply and demand throughout the year?
• What can your company do to stand apart from the top competitors?

Step 4: Write Descriptions of the Products or Services

In this section, you should detail the product or service offered by your business. You should explain what it does, how it helps your customers, and its expected lifecycle. You can also include things like any expected research and development costs, intellectual property concerns such as patents, what the lifecycle of your product looks like, and what is needed to manufacture or assemble it.

Here are some things to consider as you are working on this section:

• Description of what your product or service does
• How your product or service works
• How your customers will benefit from your product or service
• Illustration of the typical lifecycle
• Any patents or intellectual property you or your competitors have
• Pricing structure
• Plans for research and development
• Discuss plans for handling intellectual property, copyright, and patent filings

Step 5: Indicate the Marketing & Sales Strategy

Details of your marketing and sales strategy will be highly dependent on your business. It’s also something that may evolve and change over time in response to things like the overall economic environment, release of competitor’s products or services, and changes in pricing.

With that being said, here is a list of some items that should be addressed:

• Who is your target audience?
• How will you attract customers?
• How and where will sales be made?
• If applicable, what will the sales process look like?
• Where will you market and advertise your product or service?
• How does your marketing strategy compare to other companies in the industry?
• How much should you spend on marketing?
• What is the expected return on investment for marketing?
• Do you have any data showing the effect of marketing?

Step 6: List Financial Data & Projections

If your business has been running, you should include information about its finances. This should include all streams of revenue and expenses. Data for financial projections should also be included, along with a description of the methodology you used to reach those conclusions.

If available, you should be prepared to provide the following financial documents for at least the last three years to five years:

• Personal and business tax returns
• Balance sheets
• Profit and loss (P&L) statements
• Cash flow statements
• Hard and soft collateral owned by your business
• Business bank statements for the last six to 12 months

Financial projections should include enough data to offer some confidence that your business is viable and will succeed. It’s recommended that you provide monthly projections looking forward at least three years, with annual projections for years four and five.

• Projections for revenue and methodology used in arriving at these figures
• Expected shifts in revenue or expenses as a result of seasonality or other factors affecting supply and demand
• Expected expenses from loan payments, rent, lease payments, marketing and advertising fees, employee salaries, benefits, legal fees, warranty expenses, and more

You can use our SBA loan calculator to help you estimate monthly payments for the funding you’re currently looking for and projections for any additional loans you may need. Monthly payments can fluctuate depending on the terms of your loan. If you’re looking for accurate estimates, you can read our article on SBA loan rates .

Step 7: Write the Financing Request

This section is where you should specify how much funding you need, why you need it, what you’ll use it for, and the impact you expect it will have on your business. It’s also a good idea to indicate when you expect to use the funds over the course of the next three to five years.

Here is a checklist of some important items you should cover:

• How much funding you need and why
• When you will use the funds over the next three to five years
• What you will use the funds for
• The expected impact this will have on your business and how it will help reach your business goals
• The anticipation of any recurring needs for additional funding
• Your strategy for how you expect to pay off the loan
• Any future financial plans for your business

Step 8: Fill In the Appendix & Supplemental Information

This last section of your SBA business plan should include any additional information that may be helpful for lenders. This can include more detailed explanations or clarifications of data from other sections of your business plan.

Here are some examples of documents you can include:

• Business licenses
• Certifications or permits
• Letters of reference
• Photos of products
• Resumes of business owners
• Contractual agreements and other legal documents

Step 9: Complete the Executive Summary

The executive summary, which is the first section in a business plan, should be no more than one to two pages and provide a high-level overview of the items listed below. Since each section above is already detailed, a brief description of those sections will be sufficient:

• Your company’s mission statement
• The background and experience of your leadership team
• The product or service and what purpose it serves
• Your target market for the product or service
• Competitive analysis of other products and services
• Your competitive advantage or why your company will succeed
• Marketing and sales strategy
• Financial projections and funding needs

Depending on the type of SBA loan you’re applying for, certain areas of your business plan may be weighed more heavily than others. You can learn about the SBA loan options you can choose from in our guide on the different types of SBA loans .

Additional Resources for Writing an SBA Business Plan

If you’re looking for additional resources to help you write a business plan, you can consider the options below. Since a business plan is just one of many documents you’ll need, you can also read our guide on how to get an SBA loan if you need help with other areas of the loan process:

• SBA: SBA’s business guide contains information on how you can start a small business. It includes steps on creating a business plan, funding your company, and launching a business.
• SCORE: Through SCORE, you can request to be paired with a mentor and get business-related education. Educational courses come in several formats, including webinars, live events, and online courses.
• Small Business Development Center (SBDC): SBDCs provide training and counseling to small business owners. This can help with various aspects of your company such as getting access to working capital, business planning, financial management, and more. You can use the SBA’s tool to find your closest SBDC .

Having a strong SBA business plan can improve your chances of getting approved for an SBA loan. If you’re unsure where to start, you can use our guide and template to cover the most important aspects of your business. You can also see our tips on how to get a small business loan . To get even more ideas on creating a strong business plan, you can also utilize resources through organizations such as SCORE and the SBA itself.

About the Author

Find Andrew On LinkedIn

Andrew Wan is a staff writer at Fit Small Business, specializing in Small Business Finance. He has over a decade of experience in mortgage lending, having held roles as a loan officer, processor, and underwriter. He is experienced with various types of mortgage loans, including Federal Housing Administration government mortgages as a Direct Endorsement (DE) underwriter. Andrew received an M.B.A. from the University of California at Irvine, a Master of Studies in Law from the University of Southern California, and holds a California real estate broker license.

Join Fit Small Business

Sign up to receive more well-researched small business articles and topics in your inbox, personalized for you. Select the newsletters you’re interested in below.

SBA Business Plan Template: Full Guide [2023]

• January 12, 2023
• Small Businesses

In 2020, SBA’s flagship 7(a) loan program approved more than 42,000 loans totalling $22 billion . Yet, SBA loans are notoriously difficult to obtain for small businesses: less than 15% of SBA loan applications were granted by big banks. If you’re applying for a SBA loan , you will need a solid business plan template for your loan application.

In this article we go through, step-by-step, all the different sections you need in your business plan to build a complete, clear and solid business plan lenders will approve. Read on!

Why do you need a business plan for your SBA loan application?

Other than your basic eligibility requirements, the primary element that lenders would review is your business plan. Having a good business plan determines if your business is a lucrative opportunity for SBA lenders.

Also, a solid business plan makes it easier to get your loans approved because banks would be confident that your business would be successful and you would be able to repay your loan.

However, business plans tend to differ depending on the nature and status of your business. If you’re running an independent business or launching a startup for example, your business plan will be reviewed more thoroughly.

1. Executive summary

The executive summary is the most important page of your SBA business plan template . We can’t make this clearer. This is the first section that the lenders will have a look at.

Before we go into specifics, keep in mind the executive summary actually is a summary. Keep it brief: your executive summary should never be more than 2 pages maximum .

Your executive summary should consists of 5 parts:

• The “mission statement “: what problem(s) is your business solving?
• Product and service : what is it that you sell? to whom? where?
• People : who are the founders / management? What about their experience? How many people / teams do you employ?
• Key financials and projections : what are your key metrics and financials today (revenues, customers, etc.)? What do you expect these to be in 3/5 years from now?
• Funding ask : what (how much) are you asking as part of this loan? Where will you spend it? For what?

2. Company description

The company description is where we go into more details about your business, and which problem(s) it actually solves.

You should explain here clearly:

What is the problem at stake?

You should list here the 2/3 friction points you aim to tackle.

Remember: even if your business isn’t necessarily innovative, your business is potentially solving a problem, as obvious as it may be, for many people out there. The more obvious the problem is, the more people it affects, the better

What is your solution?

Your business is commercialising a product and/or a service which solves the problem mentioned above. Here, you should explain 2 things: how your product / service works, and what benefits it brings to your customers.

Ideally, you should compare the pain points explained earlier (the problem) to the benefits your solution brings to your customers. That way, it is crystal clear to lenders and investors your solution really adds value to potential customers .

When explaining your business’ solution, you should explain clearly who is your customer persona . In other words, who are your customers (or who do you think they will be)? Which gender, age range, social background, interests, etc?

Where are you going?

The third section of the company description should explain what your strategy is in the short to long term. Are you expecting to launch new products? To expand regionally, internationally? Etc.

3. Market plan and analysis

The market plan and analysis section tell investors and lenders that you have extensively studied the market and reveal your competitive plan.

Your market plan and analysis section should include the following:

Industry overview and outlook

Here you need to clearly identify 2 very important metrics:

• Market size : how big is your market?
• Market growth: how fast does your market grow?

If you are operating in a niche market, chances are that you will face some challenges: the information might not be publicly available. In any case, you should be able to make a high-level estimation of your market. Read our article on market sizing and how to estimate TAM, SAM and SOM for your startup .

When looking for these metrics, you have multiple sources of information: public reports, specialised press, etc. Even public companies publish press releases and annual reports including some of their proprietary market estimates so be sure to look there too.

Competitive landscape

Here we must answer 2 key questions:

How fragmented is your market?

Are there 3 big players sharing 90% market share or thousands of small players? Here, refer to public market reports and your own understanding of the competitive landscape .

A few questions you could ask yourself, among others:

• Who are your competitors?
• Are they local, regional, national or global?
• Are there any product alternatives to your product?
• What about their IP / technological advantage?

Where do you position yourself vs. competition?

Is your solution a game changer other competitors don’t have (yet)? Do you have competitors with similar products/services?

Ideally, you would create a small table with, for each type of competitors and their main characteristics.

For instance, do they all a global presence? Do they cover all the products you offer? What is their relative price positioning (expensive vs. accessible)?

4. Organization and management

The amount of details you need to include here varies depending on the size of your company.

No matter how many leadership roles there are, an organizational chart effectively shows lenders and investors how the management system is structured.

If you plan on running your business alone indefinitely, you can write a short paragraph explaining your qualifications and previous professional experiences.

The first thing you should include in this section is a list of each management position. This list includes who will fill the role and the qualifications of these people. These people are the heart of your company, and their skills and experience are vital in ensuring your company’s success.

Next, provide any additional information about how the management team will contribute to the business’s success. Be sure to give as many details as possible since lenders need to be comfortable and confident that you have a good team running your business.

Lastly, include information about the Board of Directors (and/or any other advisors to your business).

5. Service or product line

The level of detail and the content of this section changes depending on the type of business you have. A number of questions you need to answer are shown below (but not limited to):

• Are you selling products or services (or both)?
• How many products do you sell?
• What are they?
• What is their pricing?
• How do they work?
• Are your products protected by any kind of intellectual property (copyright, patent, etc.)?
• If you do not manufacture all of your product(s): who are they suppliers? Where do they fit in the value chain ? etc.

Expert-built financial model templates for tech startups

6. Marketing and sales

Your SBA business plan template should include a marketing and sales plan where you describe your strategy for acquiring potential clients.

Here, you should give details about your marketing plan. A few questions you should answer are:

• How you plan to build and support your sales strategy ?
• What channel(s) are you using (online vs. offline)?
• How it makes sense for your target audience (the customer persona mentioned above)?

What about your metrics?

Sales and marketing goals and KPIs are also provided in this section. Don’t forget to include a detailed report about budgets for both sales and marketing.

Include metrics such as conversion rate, customer acquisition cost (CAC) , the efficiency of your sales team, etc.

It’s ok if you don’t know them already (if you are about to launch you new venture for example), yet you should have at least targets for them. How many website visitors do you expect to generate next year? What is your target conversion rate? Etc.

This particular report would be of great interest to lenders since they will glimpse how you handle your budget. Indeed, if you expect to spend in average $100 Customer Acquisition Cost, lenders will tie the number into your financial projections later on (more on that below).

Proving lenders you are able to link your financial projections with your actual business metrics (customers, sales volume, etc.) is a big plus . Indeed, that way you will show lenders you understand very clearly your business and how it ties into your financials (more on that in our article on why you should build a solid financial projections ).

7. Funding request

The funding request is the section of your SBA business plan template where you communicate to your investors how much you need.

This report also includes how you plan on repaying your loan. It’s also essential to explain how you plan to spend the funding you’ll receive for your business.

Will you spend the loan in working capital , in equipment, in inventory, salaries or marketing costs? The more specific you are, the better.

If you haven’t done so, we really recommend you read our article on how to determine how much you should raise for you business . While raising too little creates obvious problems, raising too much isn’t necessarily better.

On top of the amount, a good practice is to include a pie chart of where you will spend that money over a given period (your runway). Will you spend the bulk of it in product development to build your MVP? Or will you use a large portion in sales & marketing to commercialise your product and find product-market fit?

Our financial model templates include a cash burn dashboard where you can easily assess how much you should raise, and where you will spend your money. We also included charts ready to be included in your pitch deck. See how to use our cash burn dashboard here .

The funding request usually includes an overview of the business. You also have to outline how much funding you need for the next five years.  The standard timeframe for repaying your loan is usually ten years, so lenders expect to see some success in your business by that time. Mention a  detailed explanation of how the funds will be used and strategic financial plans for the future here.  Include financial information for current operations if applicable.

8. Financial projections

The financial projections section of your SBA business plan is one of the most important one.

Why? Lenders will have a thorough review of your expected financials over the next 3 to 5 years and judge whether your financial projections:

Are realistic (and use verifiable assumptions)

We are all by nature optimistic, especially when we are running businesses. It’s good to be optimistic, yet it is another one to be unrealistic.

Also, when presenting your financial projections, make sure to make it clear what are your assumptions. The more sources you can find to back up your forecasts, the better.

If you need help building realistic projections for your business, we have lots of free content. Make sure to check out our guides below:

• The 5 Mistakes To Avoid For Your Startup Financial Plan
• How To Build Realistic Revenue Projections For Your Startup?

Allow you to repay the SBA loan in the future

It’s great if you have built rock-solid and realistic financial projections for your business plan. Yet, if your plan doesn’t allow you to meet your debt obligations (the SBA loan and any other debt your business might have), lenders will not grant you any loan.

When assessing whether your financial plan allows you to repay the debt, you should check if the positive cash flows your business generates are enough to cover your debt repayment (and interests).

What financials should you include?

In short, you should present 3 different set of financials:

• Profit-and-loss
• Balance sheet
• Cash flow statement

If you don’t know them already, these are the financial statements every business need to prepare at least annually (with the help of an accountant). For more information on what they are and how to prepare them, read our articles below:

• 4 Key Financial Statements For Your Startup Business Plan
• SBA Loan Application: 6 Steps To Build Solid Financial Projections

9. Appendix

This section is the best place to add supporting documents like charts, graphs, and data.

For example, a complete list of documents like licenses, contracts, maps, etc. makes you more attractive to lenders as it gives them more content to review. If you do so, make sure to reference the documents in appendix and link them to pages in earlier sections. Avoid using the appendix as a dump section: it should be well organised and structured (else no one will bother looking at it).

Privacy Overview

550+ Business Plan Examples to Launch Your Business

Need help writing your business plan? Explore over 550 industry-specific business plan examples for inspiration.

Find your business plan example

Accounting, Insurance & Compliance Business Plans

• View All 25

Children & Pets Business Plans

• Children's Education & Recreation
• View All 33

Cleaning, Repairs & Maintenance Business Plans

• Auto Detail & Repair
• Cleaning Products
• View All 39

Clothing & Fashion Brand Business Plans

• Clothing & Fashion Design
• View All 26

Construction, Architecture & Engineering Business Plans

• Architecture
• Construction
• View All 46

Consulting, Advertising & Marketing Business Plans

• Advertising
• View All 54

Education Business Plans

• Education Consulting
• Education Products

Business plan template: There's an easier way to get your business plan done.

Entertainment & Recreation Business Plans

• Entertainment
• Film & Television
• View All 60

Events Business Plans

• Event Planning
• View All 17

Farm & Agriculture Business Plans

• Agri-tourism
• Agriculture Consulting
• View All 16

Finance & Investing Business Plans

• Financial Planning
• View All 10

Fine Art & Crafts Business Plans

Fitness & Beauty Business Plans

• Salon & Spa
• View All 36

Food and Beverage Business Plans

• Bar & Brewery
• View All 77

Hotel & Lodging Business Plans

• Bed and Breakfast

Brought to you by

Create a professional business plan

Using ai and step-by-step instructions.

Secure funding

Validate ideas

Build a strategy

IT, Staffing & Customer Service Business Plans

• Administrative Services
• Customer Service
• View All 22

Manufacturing & Wholesale Business Plans

• Cleaning & Cosmetics Manufacturing
• View All 68

Medical & Health Business Plans

• Dental Practice
• Health Administration
• View All 41

Nonprofit Business Plans

• Co-op Nonprofit
• Food & Housing Nonprofit
• View All 13

Real Estate & Rentals Business Plans

• Equipment Rental

Retail & Ecommerce Business Plans

• Car Dealership
• View All 116

Technology Business Plans

• Apps & Software
• Communication Technology

Transportation, Travel & Logistics Business Plans

• Airline, Taxi & Shuttle
• View All 62

View all sample business plans

Example business plan format

Before you start exploring our library of business plan examples, it's worth taking the time to understand the traditional business plan format . You'll find that the plans in this library and most investor-approved business plans will include the following sections:

Executive summary

The executive summary is an overview of your business and your plans. It comes first in your plan and is ideally only one to two pages. You should also plan to write this section last after you've written your full business plan.

Your executive summary should include a summary of the problem you are solving, a description of your product or service, an overview of your target market, a brief description of your team, a summary of your financials, and your funding requirements (if you are raising money).

Products & services

The products & services chapter of your business plan is where the real meat of your plan lives. It includes information about the problem that you're solving, your solution, and any traction that proves that it truly meets the need you identified.

This is your chance to explain why you're in business and that people care about what you offer. It needs to go beyond a simple product or service description and get to the heart of why your business works and benefits your customers.

Market analysis

Conducting a market analysis ensures that you fully understand the market that you're entering and who you'll be selling to. This section is where you will showcase all of the information about your potential customers. You'll cover your target market as well as information about the growth of your market and your industry. Focus on outlining why the market you're entering is viable and creating a realistic persona for your ideal customer base.

Competition

Part of defining your opportunity is determining what your competitive advantage may be. To do this effectively you need to get to know your competitors just as well as your target customers. Every business will have competition, if you don't then you're either in a very young industry or there's a good reason no one is pursuing this specific venture.

To succeed, you want to be sure you know who your competitors are, how they operate, necessary financial benchmarks, and how you're business will be positioned. Start by identifying who your competitors are or will be during your market research. Then leverage competitive analysis tools like the competitive matrix and positioning map to solidify where your business stands in relation to the competition.

Marketing & sales

The marketing and sales plan section of your business plan details how you plan to reach your target market segments. You'll address how you plan on selling to those target markets, what your pricing plan is, and what types of activities and partnerships you need to make your business a success.

The operations section covers the day-to-day workflows for your business to deliver your product or service. What's included here fully depends on the type of business. Typically you can expect to add details on your business location, sourcing and fulfillment, use of technology, and any partnerships or agreements that are in place.

Milestones & metrics

The milestones section is where you lay out strategic milestones to reach your business goals.

A good milestone clearly lays out the parameters of the task at hand and sets expectations for its execution. You'll want to include a description of the task, a proposed due date, who is responsible, and eventually a budget that's attached. You don't need extensive project planning in this section, just key milestones that you want to hit and when you plan to hit them.

You should also discuss key metrics, which are the numbers you will track to determine your success. Some common data points worth tracking include conversion rates, customer acquisition costs, profit, etc.

Company & team

Use this section to describe your current team and who you need to hire. If you intend to pursue funding, you'll need to highlight the relevant experience of your team members. Basically, this is where you prove that this is the right team to successfully start and grow the business. You will also need to provide a quick overview of your legal structure and history if you're already up and running.

Financial projections

Your financial plan should include a sales and revenue forecast, profit and loss statement, cash flow statement, and a balance sheet. You may not have established financials of any kind at this stage. Not to worry, rather than getting all of the details ironed out, focus on making projections and strategic forecasts for your business. You can always update your financial statements as you begin operations and start bringing in actual accounting data.

Now, if you intend to pitch to investors or submit a loan application, you'll also need a "use of funds" report in this section. This outlines how you intend to leverage any funding for your business and how much you're looking to acquire. Like the rest of your financials, this can always be updated later on.

The appendix isn't a required element of your business plan. However, it is a useful place to add any charts, tables, definitions, legal notes, or other critical information that supports your plan. These are often lengthier or out-of-place information that simply didn't work naturally into the structure of your plan. You'll notice that in these business plan examples, the appendix mainly includes extended financial statements.

Types of business plans explained

While all business plans cover similar categories, the style and function fully depend on how you intend to use your plan. To get the most out of your plan, it's best to find a format that suits your needs. Here are a few common business plan types worth considering.

Traditional business plan

The tried-and-true traditional business plan is a formal document meant to be used for external purposes. Typically this is the type of plan you'll need when applying for funding or pitching to investors. It can also be used when training or hiring employees, working with vendors, or in any other situation where the full details of your business must be understood by another individual.

Business model canvas

The business model canvas is a one-page template designed to demystify the business planning process. It removes the need for a traditional, copy-heavy business plan, in favor of a single-page outline that can help you and outside parties better explore your business idea.

The structure ditches a linear format in favor of a cell-based template. It encourages you to build connections between every element of your business. It's faster to write out and update, and much easier for you, your team, and anyone else to visualize your business operations.

One-page business plan

The true middle ground between the business model canvas and a traditional business plan is the one-page business plan . This format is a simplified version of the traditional plan that focuses on the core aspects of your business.

By starting with a one-page plan , you give yourself a minimal document to build from. You'll typically stick with bullet points and single sentences making it much easier to elaborate or expand sections into a longer-form business plan.

Growth planning

Growth planning is more than a specific type of business plan. It's a methodology. It takes the simplicity and styling of the one-page business plan and turns it into a process for you to continuously plan, forecast, review, and refine based on your performance.

It holds all of the benefits of the single-page plan, including the potential to complete it in as little as 27 minutes . However, it's even easier to convert into a more detailed plan thanks to how heavily it's tied to your financials. The overall goal of growth planning isn't to just produce documents that you use once and shelve. Instead, the growth planning process helps you build a healthier company that thrives in times of growth and remain stable through times of crisis.

It's faster, keeps your plan concise, and ensures that your plan is always up-to-date.

Download a free sample business plan template

Ready to start writing your own plan but aren't sure where to start? Download our free business plan template that's been updated for 2024.

This simple, modern, investor-approved business plan template is designed to make planning easy. It's a proven format that has helped over 1 million businesses write business plans for bank loans, funding pitches, business expansion, and even business sales. It includes additional instructions for how to write each section and is formatted to be SBA-lender approved. All you need to do is fill in the blanks.

How to use an example business plan to help you write your own

How do you know what elements need to be included in your business plan, especially if you've never written one before? Looking at examples can help you visualize what a full, traditional plan looks like, so you know what you're aiming for before you get started. Here's how to get the most out of a sample business plan.

Choose a business plan example from a similar type of company

You don't need to find an example business plan that's an exact fit for your business. Your business location, target market, and even your particular product or service may not match up exactly with the plans in our gallery. But, you don't need an exact match for it to be helpful. Instead, look for a plan that's related to the type of business you're starting.

For example, if you want to start a vegetarian restaurant, a plan for a steakhouse can be a great match. While the specifics of your actual startup will differ, the elements you'd want to include in your restaurant's business plan are likely to be very similar.

Use a business plan example as a guide

Every startup and small business is unique, so you'll want to avoid copying an example business plan word for word. It just won't be as helpful, since each business is unique. You want your plan to be a useful tool for starting a business —and getting funding if you need it.

One of the key benefits of writing a business plan is simply going through the process. When you sit down to write, you'll naturally think through important pieces, like your startup costs, your target market , and any market analysis or research you'll need to do to be successful.

You'll also look at where you stand among your competition (and everyone has competition), and lay out your goals and the milestones you'll need to meet. Looking at an example business plan's financials section can be helpful because you can see what should be included, but take them with a grain of salt. Don't assume that financial projections for a sample company will fit your own small business.

If you're looking for more resources to help you get started, our business planning guide is a good place to start. You can also download our free business plan template .

Think of business planning as a process, instead of a document

Think about business planning as something you do often , rather than a document you create once and never look at again. If you take the time to write a plan that really fits your own company, it will be a better, more useful tool to grow your business. It should also make it easier to share your vision and strategy so everyone on your team is on the same page.

Adjust your plan regularly to use it as a business management tool

Keep in mind that businesses that use their plan as a management tool to help run their business grow 30 percent faster than those businesses that don't. For that to be true for your company, you'll think of a part of your business planning process as tracking your actual results against your financial forecast on a regular basis.

If things are going well, your plan will help you think about how you can re-invest in your business. If you find that you're not meeting goals, you might need to adjust your budgets or your sales forecast. Either way, tracking your progress compared to your plan can help you adjust quickly when you identify challenges and opportunities—it's one of the most powerful things you can do to grow your business.

Prepare to pitch your business

If you're planning to pitch your business to investors or seek out any funding, you'll need a pitch deck to accompany your business plan. A pitch deck is designed to inform people about your business. You want your pitch deck to be short and easy to follow, so it's best to keep your presentation under 20 slides.

Your pitch deck and pitch presentation are likely some of the first things that an investor will see to learn more about your company. So, you need to be informative and pique their interest. Luckily we have a round-up of real-world pitch deck examples used by successful startups that you can review and reference as you build your pitch.

For more resources, check out our full Business Pitch Guide .

Ready to get started?

Now that you know how to use an example business plan to help you write a plan for your business, it's time to find the right one.

Use the search bar below to get started and find the right match for your business idea.

The quickest way to turn a business idea into a business plan

Fill-in-the-blanks and automatic financials make it easy.

No thanks, I prefer writing 40-page documents.

Discover the world’s #1 plan building software

Loan Officer Business Plan Template

Written by Dave Lavinsky

Over the past 20+ years, we have helped thousands of loan officers develop business plans to grow their businesses. On this page, we will first give you some background information with regards to the importance of business planning. We will then go through a loan officer business plan template step-by-step so you can create your plan today.

Download our Ultimate Business Plan Template here >

What is a Loan Officer Business Plan?

A business plan provides a snapshot of your loan business as it stands today, and lays out your growth plan for the next five years. It explains your business goals and your strategy for reaching them. It also includes market research to support your plans.

Why You Need a Business Plan for a Loan Officer

If you’re looking to grow your existing loan business, you need a business plan. A business plan will plan out the growth of your loan business in order to improve your chances of success. Your loan business plan is a living document that should be updated annually as your company grows and changes.

Finish Your Business Plan Today!

If you want to grow your loan officer business, you need a business plan. Below are links to each section of your loan officer business plan template:

Executive Summary

Your executive summary provides an introduction to your business plan, but it is normally the last section you write because it provides a summary of each key section of your plan.

In it you must provide an overview of each of the sections of your plan. For example, give a brief overview of the loan industry. Discuss the type of loan business you are operating. Detail your direct competitors. Give an overview of your target customers. Provide a snapshot of your marketing plan. Identify the key members of your team. And offer an overview of your financial plan.  

Company Analysis

In your company analysis, you will detail the type of loan business you are operating.

For example, you might operate one of the following types of loan businesses:

• Commercial Loan Officer : this type of loan business focuses on arranging business loans.
• Consumer Loan Officer: this type of business focuses on providing loans for things such as vehicles.
• Mortgage Loan Officer: this type of loan obtains loans for consumer to purchase real estate.

In addition to explaining the type of loan business you will operate, the Company Analysis section of your business plan needs to provide background on the business.

Include answers to question such as:

• When and why did you start the business?
• What milestones have you achieved to date? Milestones could include the number of customers served, number of positive reviews, dollar value of loans arranged, etc.
• Your legal structure. Are you incorporated as an S-Corp? An LLC? A sole proprietorship? Explain your legal structure here.

Industry Analysis

In your industry analysis, you need to provide an overview of the loan industry.

While this may seem unnecessary, it serves multiple purposes.

First, researching the loan industry educates you. It helps you understand the market in which you are operating.

Secondly, market research can improve your strategy, particularly if your research identifies market trends.

The third reason for market research is to prove to readers that you are an expert in your industry. By conducting the research and presenting it in your plan, you achieve just that.

The following questions should be answered in the industry analysis section of your loan business plan:

• How big is the loan industry (in dollars)?
• Is the market declining or increasing?
• Who are the key competitors in the market?
• Who are the key suppliers in the market?
• What trends are affecting the industry?
• What is the industry’s growth forecast over the next 5 – 10 years?
• What is the relevant market size? That is, how big is the potential market for your loan business? You can extrapolate such a figure by assessing the size of the market in the entire country and then applying that figure to your local population.

Customer Analysis

The customer analysis section of your loan officer business plan must detail the customers you serve and/or expect to serve.

The following are examples of customer segments: parents, students, professionals, businesses, couples, families, prospective home buyers, prospective car buyers, contractors, etc.

As you can imagine, the customer segment(s) you choose will have a great impact on the type of loan business you operate. Clearly, someone interested in purchasing a new car would respond to different marketing promotions than a business seeking equipment financing, for example.

Try to break out your target customers in terms of their demographic and psychographic profiles. With regards to demographics, include a discussion of the ages, genders, locations and income levels of the customers you seek to serve. Because most loan businesses primarily serve customers living in their same city or town, such demographic information is easy to find on government websites.

Psychographic profiles explain the wants and needs of your target customers. The more you can understand and define these needs, the better you will do in attracting and retaining your customers.

Finish Your Loan Officer Business Plan in 1 Day!

Don’t you wish there was a faster, easier way to finish your business plan?

With Growthink’s Ultimate Business Plan Template you can finish your plan in just 8 hours or less!

Competitive Analysis

Your competitive analysis should identify the indirect and direct competitors your business faces and then focus on the latter.

Direct competitors are other loan businesses.

Indirect competitors are other options that customers have to purchase from that aren’t direct competitors. This includes commercial banks, online loan brokers, etc. You need to mention such competition as well.

With regards to direct competition, you want to describe the other loan businesses with which you compete. Most likely, your direct competitors will be loan officers located very close to your location.

For each such competitor, provide an overview of their businesses and document their strengths and weaknesses. Unless you once worked at your competitors’ businesses, it will be impossible to know everything about them. But you should be able to find out key things about them such as:

• What types of customers do they serve?
• What types of loans do they specialize in?
• What is their pricing (premium, low, etc.)?
• What are they good at?
• What are their weaknesses?

With regards to the last two questions, think about your answers from the customers’ perspective. And don’t be afraid to ask your competitors’ customers what they like most and least about them.

The final part of your competitive analysis section is to document your areas of competitive advantage. For example:

• Will you provide higher value loans?
• Will you offer lower interest rates on loans?
• Will you provide better customer service?
• Will you offer a wider variety of loan options?

Think about ways you will outperform your competition and document them in this section of your plan.  

Marketing Plan

Traditionally, a marketing plan includes the four P’s: Product, Price, Place, and Promotion. For a loan officer business plan, your marketing plan should include the following:

Product : In the product section, you should reiterate the type of loan company that you documented in your Company Analysis. Then, detail the specific products you will be offering. For example, in addition to loans, will you provide insurance, financial advisory, or real estate services?

Price : Document the prices you will offer and how they compare to your competitors. Essentially in the product and price sub-sections of your marketing plan, you are presenting the services you offer and their prices.

Place : Place refers to the location of your loan company. Document your location and mention how the location will impact your success. For example, is your loan business located near a real estate brokerage, or car dealership, etc. Discuss how your location might be the ideal location for your customers.

Promotions : The final part of your loan officer marketing plan is the promotions section. This is perhaps the most important section of your plan. Here you will document how you will drive customers to your website and/or location(s). The following are some promotional methods you might consider:

• Advertising in local papers and magazines
• Reaching out to local websites
• Social media marketing
• Local radio advertising

Operations Plan

While the earlier sections of your business plan explained your goals, your operations plan describes how you will meet them. Your operations plan should have two distinct sections as follows.

Everyday short-term processes include all of the tasks involved in running your loan business, including processing loan applications, arranging signings, marketing your business, paperwork, etc.

Long-term goals are the milestones you hope to achieve. These could include the dates when you expect to arrange your 100 th loan, or when you hope to reach $X in revenue. It could also be when you expect to expand your loan business to a new city.  

Management Team

To demonstrate your loan business’ ability to succeed, a strong management team is essential. Highlight your key players’ backgrounds, emphasizing those skills and experiences that prove their ability to grow a company.

Ideally you and/or your team members have direct experience in managing loan businesses. If so, highlight this experience and expertise. But also highlight any experience that you think will help your business succeed.

If your team is lacking, consider assembling an advisory board. An advisory board would include 2 to 8 individuals who would act like mentors to your business. They would help answer questions and provide strategic guidance. If needed, look for advisory board members with experience as a loan officer or success being a local bank or credit union manager.  

Financial Plan

Your financial plan should include your 5-year financial statement broken out both monthly or quarterly for the first year and then annually. Your financial statements include your income statement, balance sheet and cash flow statements.

Income Statement : an income statement is more commonly called a Profit and Loss statement or P&L. It shows your revenues and then subtracts your costs to show whether you turned a profit or not.

In developing your income statement, you need to devise assumptions. For example, will you work on commission, or on a fee for services model? And will sales grow by 2% or 10% per year? As you can imagine, your choice of assumptions will greatly impact the financial forecasts for your business. As much as possible, conduct research to try to root your assumptions in reality.

Balance Sheets : Balance sheets show your assets and liabilities. While balance sheets can include much information, try to simplify them to the key items you need to know about. For instance, if you spend $50,000 on building out your loan business, this will not give you immediate profits. Rather it is an asset that will hopefully help you generate profits for years to come. Likewise, if a bank writes you a check for $50,000, you don’t need to pay it back immediately. Rather, that is a liability you will pay back over time.

Cash Flow Statement : Your cash flow statement will help determine how much money you need to start or grow your business, and make sure you never run out of money. What most entrepreneurs and business owners don’t realize is that you can turn a profit but run out of money and go bankrupt.

In developing your Income Statement and Balance Sheets be sure to include several of the key costs needed in starting or growing a loan business:

• Location build-out including design fees, construction, etc.
• Cost of equipment and supplies
• Payroll or salaries paid to staff
• Business insurance
• Taxes and permits
• Legal expenses

Attach your full financial projections in the appendix of your plan along with any supporting documents that make your plan more compelling. For example, you might include your office location lease or outline your strategic partnerships with local realtors and lenders.  

Putting together a business plan for your loan officer business is a worthwhile endeavor. If you follow the template above, by the time you are done, you will truly be an expert. You will really understand the loan industry, your competition, and your customers. You will have developed a marketing plan and will really understand what it takes to launch and grow a successful loan business.  

Loan Officer Business Plan FAQs

What is the easiest way to complete my loan officer business plan.

Growthink's Ultimate Business Plan Template allows you to quickly and easily complete your Loan Officer Business Plan.

What is the Goal of a Business Plan's Executive Summary?

The goal of your Executive Summary is to quickly engage the reader. Explain to them the type of loan officer business you are operating and the status; for example, are you a startup, do you have a loan officer business that you would like to grow, or are you operating a chain of loan officer businesses?

Don’t you wish there was a faster, easier way to finish your Loan Officer business plan?

OR, Let Us Develop Your Plan For You

Since 1999, Growthink has developed business plans for thousands of companies who have gone on to achieve tremendous success.   Click here to see how Growthink’s professional business plan consulting services can create your business plan for you.

Other Helpful Business Plan Articles & Templates

Our Recommendations

• Best Small Business Loans for 2024
• Businessloans.com Review
• Biz2Credit Review
• SBG Funding Review
• Rapid Finance Review
• 26 Great Business Ideas for Entrepreneurs
• Startup Costs: How Much Cash Will You Need?

How to Get a Bank Loan for Your Small Business

• Articles of Incorporation: What New Business Owners Should Know
• How to Choose the Best Legal Structure for Your Business

Small Business Resources

• Business Ideas
• Business Plans
• Startup Basics
• Startup Funding
• Franchising
• Success Stories
• Entrepreneurs
• The Best Credit Card Processors of 2024
• Clover Credit Card Processing Review
• Merchant One Review
• Stax Review
• How to Conduct a Market Analysis for Your Business
• Local Marketing Strategies for Success
• Tips for Hiring a Marketing Company
• Benefits of CRM Systems
• 10 Employee Recruitment Strategies for Success
• Sales & Marketing
• Social Media
• Best Business Phone Systems of 2024
• The Best PEOs of 2024
• RingCentral Review
• Nextiva Review
• Ooma Review
• Guide to Developing a Training Program for New Employees
• How Does 401(k) Matching Work for Employers?
• Why You Need to Create a Fantastic Workplace Culture
• 16 Cool Job Perks That Keep Employees Happy
• 7 Project Management Styles
• Women in Business
• Personal Growth
• Best Accounting Software and Invoice Generators of 2024
• Best Payroll Services for 2024
• Best POS Systems for 2024
• Best CRM Software of 2024
• Best Call Centers and Answering Services for Busineses for 2024
• Salesforce vs. HubSpot: Which CRM Is Right for Your Business?
• Rippling vs Gusto: An In-Depth Comparison
• RingCentral vs. Ooma Comparison
• Choosing a Business Phone System: A Buyer’s Guide
• Equipment Leasing: A Guide for Business Owners
• HR Solutions
• Financial Solutions
• Marketing Solutions
• Security Solutions
• Retail Solutions
• SMB Solutions

Need funding? A small business bank loan can be a good option, if you qualify for it. Here are some tips to make it easier to get a bank business loan.

Table of Contents

Unless your small business is completely self-funded or backed by investors, you’re likely going to need a small business loan to help you start or grow your business. Commonly offered by banks, business loans offer a much-needed infusion of cash to help cover most costs , though many small business owners find it hard to be approved. When seeking a business loan from a bank, it’s important to keep the following information and tips in mind so you can get approved more quickly and easily.

What are the types of bank loans for small businesses?

When looking at potential financing options, here are some of the more common types of business loans to consider.

Business term loan

This loan is your traditional bank term loan option, provided by a financial institution, and it operates similarly to a personal loan in some aspects. Businesses often seek this type of loan when they need funds for major investments, business upgrades, acquisitions or other major needs. 

Depending on the agreement, these loans tend to feature a fixed interest rate, with the lender requiring a monthly payment or quarterly payment schedule. These loans also have a fixed end date, with intermediate-term loans running for three years or less and long-term loans running for 10 years or possibly longer.

Line of credit

When considering a business line of credit , think of it like a credit card. If approved, your small business is able to borrow up to a certain amount of money from the bank. As you accrue debt, you pay interest only on the amount you’ve used so far. 

As long as you stay within the credit limit, this option provides much more flexibility in how the money is used. This option is great for small businesses that have a steady flow of income, a decent credit history and, in some cases, are willing to put assets up as collateral. [Read related article: What Is a Revolving Line of Credit? ]

Editor’s note: Looking for the right loan for your business? Fill out the below questionnaire to have our vendor partners contact you about your needs.

Commercial mortgage

If your business is looking to acquire a location to expand, a commercial mortgage is the type of loan you need. A commercial mortgage is secured through a lien on a commercial property and acts similarly to a home mortgage. 

Suppose your credit history is nonexistent or unflattering. In that case, a bank can require that the business owner or any principals personally guarantee the loan, promising to pick up the tab in the event the business goes under. While most residential mortgages typically last for 30 years, commercial mortgages are significantly shorter.

Equipment lease

Not unlike leasing a car, an equipment lease spreads out the cost of a major equipment purchase over a set amount of time. Most lessors don’t need a large down payment on a lease.

Once the lease has run its course, you can opt to return the equipment. Alternatively, you can pay the rest of the equipment’s value based on the life of the lease and the appreciation of the item in question. Though the monthly payments will be lower than the upfront cost of just purchasing a piece of equipment, it’s important to note that interest will add to the price tag.

Letter of credit

A letter of credit is a guarantee from a bank that a seller will receive the correct payment owed on time. The guarantee comes in two different flavors: seller protection or buyer protection. In the former, the bank agrees to pay the seller if the buyer fails to make their payments; this is generally offered for international transactions. 

Funds for this type of letter are sometimes collected from the buyer upfront in a sort of escrow. Buyer protection is offered in the form of a penalty to the seller, like a refund. Banks provide these letters to businesses that apply for one and have the credit history or collateral required.

Unsecured business loan

An unsecured business loan doesn’t require the borrower to provide any collateral against the amount they’re borrowing. Since it’s friendlier to the borrower than the bank, the lender charges a significantly higher interest rate than it would for a loan backed by collateral. This kind of loan is most commonly provided through an online lender or alternative lender , though traditional banks have been known to offer unsecured loans to customers with an existing relationship with the institution. 

Without any assurances in the form of collateral, unsecured business loans are often much harder to obtain than other loans. The inherent risk involved in an unsecured loan naturally means it will generally be offered as a short-term loan to alleviate the lender’s risk.

How do you get a bank loan for your business?

Follow these steps to get the funding your business needs.

1. Research lenders to find the right one.

Evaluate the best business loans side by side across several factors to determine which loan fits your needs. Key factors include:

• Interest rate
• Rules and requirements, such as origination fees
• Qualifying criteria, such as credit scores and annual sales volume
• Collateral requirements
• How quickly you can get funding
• Additional paperwork requirements

2. Get your financials in order.

Ask the bank what information it will need when going through the application process relative to the type of loan you’re seeking and the size of the request. To this end, you should generally try to have three years’ worth of business and personal tax returns on hand as well as year-to-date profit and loss figures, balance sheets, accounts receivable aging reports, and inventory breakdowns, if possible. 

If you have a CPA or bookkeeper , you can usually get all of that information from them. However, the best accounting software [See our QuickBooks review or Xero review ] can just as easily generate most of that information as well.

3. Create a business plan.

If you’re seeking a loan as a startup, it’s imperative that you also have your business plan drawn up. If you don’t have that laid out in writing just yet, there are plenty of free resources that you can use, including local Small Business Development Centers , SCORE and Economic Development Centers .

4. Estimate how much you’re going to need. 

If you need a loan for a one-time purchase or another financing option, it’s also important to have estimates for the work or purchase ready to show the loan officer.

“Lenders want to see that you’ve carefully thought through your business goals, know how much you need to achieve them and have a specific plan to use the money wisely,” said small business content writer Karen Axelton. “Whether your goal is to open a second location or buy new machinery, run the numbers to see how much it will cost. Also calculate how loan repayments will affect your business budget going forward.”

5. Complete and submit your application (and regularly check on it).

Your final step is to complete the loan application. This process will look different for each loan. For example, some banks tout their quick applications as a selling point, whereas SBA loans are known for their tedious, lengthy applications. 

Once you’ve filed your application, you’ll get an answer within a period that the bank has likely stated outright. Typically, this period is at least one week and is often much longer. The good news is that, since many bank loan applications are submitted online, your completed application should give you access to an online portal. You can usually track your application’s status and follow up with your contact at the bank to request updates.

6. Review the final loan offer.

At the end of a successful loan application, the bank will draw up a loan contract specific to your business. You should go through this final loan offer carefully to make sure that everything looks right. All collateral, interest rate, term length and fee provisions in the contract should align with what you and the bank have previously discussed. If everything checks out, you’re all set to sign on the dotted line.

What are the requirements for getting a business loan?

When applying for a business loan, it’s imperative that you keep a bank’s requirements in mind. Each bank has its own loan application forms. Many institutions offer their applications online, though some still require you to fill out a paper form. The bank may have a preferred method of applying based on the loan amount and the kind of loan you’re seeking.

In addition to how a bank prefers to receive a loan application, you should also pay attention to the prerequisites that a bank needs in order to be considered for approval. Many factors go into a potential approval, so prior to applying, be sure to check on the following:

• Credit score: A high credit score shows that you’re reliable when it comes to paying down your debt. A good credit score not only can make or break your application, but it also affects the interest rate and loan term length the bank offers you.
• Purpose of the loan: Some loans come with stipulations for how they’re used. For instance, a lease is generally used to obtain equipment, while a mortgage is for real estate purchases.
• Available collateral: If your credit score isn’t good enough, some lenders will make an exception if you can put some valuable items (usually property) up as collateral. If you fail to meet the agreement’s repayment guidelines, you can lose that collateral to the bank , which will likely sell the assets in question to recoup some of its losses.
• Cash flow: Banks want to know you have a steady income stream. Traditional lenders could be skittish about approving your loan without a consistent cash flow. Many lenders require a certain amount of revenue before even making such a consideration.
• Financials: Cash flow history is one type of document that the bank will want to see prior to approving a loan. You will also need to show well-researched financial projections for your business. 
• Business plan: Any type of lender can ask for your business plan before reviewing an application. There are many resources available to help you get started on writing an effective business plan for your organization.
• Capital: Working capital refers to how much money the company has on hand to cover operating costs. You may be considered a high-risk investment if you don’t have any working capital.

What are the benefits and risks of getting a business loan?

The below pros and cons of small business bank loans are worth considering as you decide whether to apply.

Benefits of small business bank loans

• They come with inherent safety nets. Backed by the federal government, banks and most of their loans come with assurances that many nontraditional and online banking lessors don’t. Also, bank loans generally carry lower interest rates than loans from online lenders, minimizing your risk of taking on prohibitively expensive debt.
• They may offer longer terms. Often, you can repay a bank loan over a longer period than other types of business funding. This means that your monthly payments will be lower, easing the financial burden associated with loans. For example, a $100,000 loan you repay over 10 years requires $100,000/10 = $10,000 in repayments per year. That’s $833.33 per month, which is much more reasonable than paying back $100,000 over one year, or $8,333.33 per month.
• They may offer flexible use terms. Some bank loans don’t limit the ways in which you can use your proceeds. In cases where limitations do exist, minor deviations might not be a problem if you keep paying on time. Of course, you shouldn’t ignore or neglect your loan’s use terms; that would be highly ill-advised. However, with bank loans, you typically get more leeway if you accidentally make purchases outside your contract’s limitations and keep making timely payments,

Risks of small business loans

• You could choose the wrong loan. After deciding that your small business would benefit from a business loan in the short term, you must nail down exactly what type of loan you want to pursue. Failing to do so can result in lost time, sunk costs and other major headaches for any small business. It’s how you lose resources you could put toward obtaining solutions that actually meet your needs. 
• You could wait too long for funding. When you need funding sooner than later, small business bank loans might help only sometimes. That’s because it can take up to six weeks for your funds to be disbursed. At that point, the opportunity for which you need funding might already be off the table. Similarly, if you plan to use the loan proceeds for an urgent bill payment, slow funding disbursal could be a major risk.
• You could fail to repay. Obtaining the funding you need to grow your company doesn’t always guarantee business success. If your growth pursuits don’t lead to enough revenue to repay your loan, you could wind up defaulting. Your lender could then seize your assets, and you could have to file for bankruptcy. This is a risk inherent to any and all loans, but since bank loans are often larger, the risk may be especially pronounced.

Alternatives to bank loans

As a small business owner, you have many loan options to choose from for financing. Each type of loan comes with its own set of stipulations, requirements and other criteria that may make one a better fit for your financial situation and repayment abilities than others.

Bank loans are not your only option. You can work with alternative lenders to secure the funding you need. Alternative lenders are an option to consider if your business doesn’t qualify for a traditional loan. Here are three alternative lending options to consider:

• Online loans: Online lenders are normally more flexible with loan qualifications, and the turnaround time is faster, but the rates may be higher than traditional loans. Lendio is one such online lender. You can submit an application through its secure interface. 
• Microloans: Microloans offer a small amount of money to help you cover certain costs within your company. Microloans usually have a relatively low interest rate. The disadvantages of microloans include a shorter time frame to pay back the loan, and some lenders require that the money from the microloan be spent on specific expenses like equipment purchases.
• Invoice factoring: Through invoice factoring , you can borrow money against your clients’ unpaid invoices. To start, a factoring company will advance you between 80 percent and 90 percent of your unpaid invoices’ total. Then, the factoring company becomes responsible for collecting the unpaid invoices. Once client payment occurs, the factoring company sends you the remainder of your outstanding invoices’ total, minus fees.

Terms to watch for in a business loan contract

Besides the type of loan you apply for, consider the details of the loan. Each loan comes with its own interest rate and loan term, among other points of consideration that are as equally important as the type of loan you take on. It’s important to read the contract in full to make sure there aren’t hidden terms or fees .

When applying for a bank loan, check the following:

• Rates: Aside from the amount of money you wish to borrow, the loan rate – otherwise known as the interest rate – is something you absolutely must determine. Loan rates differ based on the type of loan you’re seeking, the bank you’re borrowing the funds from and your personal credit score, among other things. When seeking out a business loan, you want one with a low interest rate, if possible. Depending on the type of loan, you may see rates range anywhere from 3 percent up to 80 percent annual percentage rate. 
• Term: A business loan’s term is the length of time you have to pay the loan off. Like the loan rate, you generally want a shorter loan term if you can afford the payments. The longer your rate is, the more interest you will pay over time, and the more your loan will cost overall.
• Banking relationship: To be considered for a bank business loan, many institutions require that you have an existing relationship with them first. If this is not the case, you’ll need to open an account with a bank and establish a working relationship with it over time.

Banking on success

Small business bank loans can help you fund your boldest business goals if you qualify for them. Of course, the idea of taking on a substantial amount of debt to fuel your growth might seem intimidating. However, countless small business owners have successfully used loans to take their operations to the next level without incurring financial danger – and so can you.

Max Freedman contributed to this article. Source interviews were conducted for a previous version of this article.

Building Better Businesses

Insights on business strategy and culture, right to your inbox. Part of the business.com network.