When a small business owner applies for a bank loan, a lender generally asks for a considerable amount of information and documentation in order to make a determination on the loan. Borrowers should also conduct due diligence–researching what type of loan and which financing method is best for their business. Questions that a borrower should ask a lender are listed below.
- Will I have access to a personal banker–one who gets to know me, and vice-versa?
- Can I call customer service at hours that are convenient for me?
- Will I be able to do the following online:
- Make repayments via my smartphone?
- See my statements?
- Are there fees for paper statements?
Leeway on Terms
- What is the maximum loan you can approve for me, without going to committee? (Bank managers often have a certain level of authority on their own discretion.)
- With what level of loan balance do you need collateral?Will i need to secure collateral to obtain this loan? If so, what type of collateral? (home, business, vehicles)
- If I pay my loan off early, will I still owe the remainder of the interest to the lender?When I have extra cash, I’d like to pay my loan off.
- What is the best interest rate you can give me?
- Can you offer me a fixed rate instead of a floating rate?
- Can I get a better rate if I have an account with your bank?
- Can I get a better rate if I have automatic payments coming from my bank account? And can I determine the due date of each payment?
- Is there anything else I can do, or show you, to bring the interest rate down?
- Are there any origination fees?
- Are there any late fees? If so, what are they?
- Is there a grace period of I miss a payment?
Carefully reviewing all the details of any business loan arrangement, asking questions, and finding out exactly what elements are negotiable can help you make an informed decision on what’s the best fit for your business.