Not all financial institutions are created equal, but most of these organizations focus on the same areas of the debenture review process. Potential borrowers need to learn what projections, narratives, and documentation they will need to prepare loan packages. Whether the individual is applying to a traditional bank for:

• A real estate financing
• An equipment debenture
• A short-term commercial credit
• AN LOC for a working capital
• A home equity credit
• Other kinds of consumer or commercial debentures

Keys of debenture applications

The most essential characteristics prospective lending firms usually concentrate on will include the following:

• Character
• Credit history
• Collateral readily available to help secure the credit
• Cash flow projections and history of the enterprise
• Debenture documentation include personal and business financial statements, business plans, and income tax returns. It sums up and provides evidence for the items mentioned above

The first three of these criteria are objective information. However, the interpretation of these numbers can be subjective. The borrower’s character allows lending firms to make more subjective assessments of their company’s market appeal, as well as their business savvy. In assessing whether to provide funds to small businesses, lending firms are usually willing to consider individual elements that represent weaknesses …