What to Know and Do Before Requesting a Business Loan Robert Zapata Osbaldo “Ozzie” Velázquez Loan Consultant Loan Consultant West Los AngelesOrange County.

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What to Know and Do Before Requesting a Business Loan Robert Zapata Osbaldo “Ozzie” Velázquez Loan Consultant Loan Consultant West Los AngelesOrange County

Healthy personal money management habits with good documentation of business income & expenses are fundamental to have access-to-capital. Positive personal credit profile with a solid business financial position will improve opportunities to access capital for business growth. What to Know and Do Before Requesting a Business Loan

* Sources TransUnion, Fair Isaac, Experian, About.com, Springboard, The Federal Reserve Commission, The Federal Reserve. ** Creditscore.net 70% of consumers have errors in their credit reports 25% of errors can negatively impact your credit score** The good news: many credit report errors can be corrected and credit ratings can be improved Know your Personal Credit Profile

What makes up a credit report? A record of your credit activities that lists: Credit-card accounts Loans Balances How regularly you make your payments A credit report also shows legal actions taken against you for unpaid accounts

* Source: Fair Isaac What is a credit score?

What makes up a credit score*? * Source: Fair Isaac

Before Requesting a Business Loan Consider focusing on the top 2 factors that have the biggest impact on your personal credit score: 1.Payment history Paying on time (consider auto payments) 2.Amounts owed a healthy amount is 35% or less of the balance for each account

Before Requesting a Business Loan Monitor & review your credit profile regularly 1. Once a year directly with the credit bureaus Experian.com, TransUnion.com, Equifax.com On-line, in writing or by phone 2. Monthly with your credit account statements Credit Cards Statements Installment Accounts

Before Requesting a Business Loan Make use of a simple budget 1. Track 2 to 3 months of your income & expenses 2. Identify your monthly averages 3. Set budget goals 4. Develop a monthly disciplined money management habit

Budgets help control & prioritize spending Money that comes in Money earned Bonuses Alimony/Child support Investment income Retirement income Total Money In Money that goes out Rent/Mortgage Utilities Food & Drinks Clothing Medical, Dental, Vision Transportation - Automobile Credit card & Loans Movies & Restaurants Savings & Retirement Other Unplanned Total Money Out

Budgets help control & prioritize spending

Before Requesting a Business Loan Keep in mind the lenders perspective 1. How will I repay the loan? 2. Is my loan request realistic, given my proven business cash flow? Prepare documentation/proof of the business’s loan repayment capacity 1. Bank statements 2. Personal & Business Tax Returns 3. Year-To-Date Financial Statements Visit for small business guides & resourceswww.sba.gov

Before Requesting a Business Loan Credit Building Tips: Get a secured credit card from a bank Consider an Opportunity Fund Loan (CA businesses) Become a secondary account holder Have a minimum of 3 lines of credit opened Don’t close good historical accounts Set your goals — and stick to them

Before Requesting a Business Loan Remember: Business owners that make use of budgets show they can manage money well, which creates confidence in lenders. Businesses with solid sales income proof, via a bank account and tax returns, can show capacity for loan repayment and have greater opportunities of accessing capital.

Opportunity Fund Small Business Loans Amounts from $2,600 to $100,000 Micro $2,600 to $20,000 Express: $2,600 to $10,000 Terms up to 5 years Fixed interest rates of 8.5% - 18% Opportunity Fund Application Checklist At least 1 year in business Completed & Signed Application: 2 pages Personal & Business Income Tax Returns: 1 yr. Business Bank Statements: last 3 months Proof of Business: License, Permits or Schedule C Copy of the title or registration & VIN # of commercial or personal vehicle available as collateral* (*this will be used to help determine the maximum loan amount)

Robert ZapataOsbaldo “Ozzie” Velázquez Direct:(323) (714) Fax:(323) (415)