How to Get a Loan for a Restaurant
Starting a restaurant can be a daunting task that will require capital. You can do this by applying for a business loan. A loan for a restuarant can be obtained from a bank or from the Small Business Administration. However, before you can apply for a loan you will need to prepare a written proposal. The proposal explains the nature of the business and is used to determine your credibility for a loan.
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Instructions
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Create an executive summary for your proposal. The executive summary is typically one paragraph that says who you are, what your business background is, how much you are requesting for a loan and how it will be used. You can also include how you will repay the loan.
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Start a new section for the description of your business. You will want to include the products and services you plan to sell, your target customer and any competitors in your industry.
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Start another section for your management experience. This can include a resume for you and any other people that will be involved with your business.
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Explain in an additional section how you will repay the loan. Include your cash flow projections and the time frame you think the loan can be repaid.
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Create an example balance sheet to show how the loan and other sources of income, such as equity, will be used.
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Determine projections or estimates of future operations for the business's first year. You will want to include estimates for earnings and expenses as well as the reasoning behind the estimates being used for the projection.
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Provide a list of items that can be used as collateral for the loan. Collateral is something of value that is pledged to the lender to secure the loan.
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Contact a local bank or the small business administration and ask for a loan application. Complete the application and send it back with your completed proposal.
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Tips & Warnings
Type up the completed proposal with a word processing program on the computer, and then print it out.
If the proposal is not complete or if you omitted required information you can be denied a loan.
References
- Photo Credit restaurant image by Dmitry Nikolaev from Fotolia.com
