Loan FAQs
How do we determine if you and your business qualify?
- Are you the principal decision-maker for your business?
If you are, we will ask you to complete and submit the loan application. If there are multiple owners of your business, at least two of them will need to submit their information with the application.
- Have you been in business at least three years?
Your financial performance over time is usually a pretty good measure of where you've been and where you're going. To get conventional bank financing from Excel National Bank, it helps to have been in business for at least three years.
- Have you filed for bankruptcy within the past 10 years?
If either you or your business has declared bankruptcy within the last 10 years, chances are Excel National Bank will not lend to you - unless you have repaid all of your creditors. The best way for you to re-establish a good credit record is to repay your creditors as soon as possible.
- Have you consistently paid your bills - both business and personal - on time?
Excel National Bank uses a business credit-reporting agency to see how you have paid your trade suppliers and other business obligations. We use a consumer credit-reporting agency to see how you have handled your personal debt. While an occasional late or missed payment is understandable, if you consistently pay late, you may not qualify for business credit.
- Is there a tax lien, suit or judgment against you or your business?
In the case of a tax lien or a legal judgment against you or your firm, the beneficiary of any settlement stands first in line for payment. The best thing to do before you apply for business credit is to pay and release all liens and judgments, and settle all suits.
- Do you have several sources of credit in you credit history?
Credit cards, lines of credit and loans are a key part of every individual's credit record. A strong credit history proves you have the willingness and discipline to repay debts. Lack of a credit record makes it much more difficult to borrow money.
- Has your business been profitable for the last two years?
Tax returns are a quick way to determine if you've shown a profit in the last few years. If your business is not profitable, it may be difficult for you to make the payments on your credit line or loan.
- Does your business generate at least $1.50 in cash flow for every $1 you pay out to cover expenses?
Excel National Bank looks at the cash your business generates as the primary repayment source for the money we lend you. We compute the cash in your business by adding non-cash expenses (such as depreciation and amortization) to net profits.
- What are the five factors we use to assist us in making lending decisions?
Character. What kind of borrower will you be for Excel National Bank? Our best clue to your character is your personal credit history. We always check to see how well you have managed your personal debt in the past.
Credit. We use credit-reporting agencies to look at your payment history with trade suppliers and other business obligations. We also look to see that your payments to other financial institutions are current.
Cash Flow. We look at the cash flow of your business as the primary repayment source for the money we lend you.
How do we compute cash flow? A company's cash flow is its net profit, plus its non-cash expenses - depreciation and amortization.
Capacity. We want to know how you would be able to repay your loan in case there was a sudden downturn in your business. Do you have the capacity to convert other assets to cash, either by selling them or borrowing against them? Your ability to do this could include real estate holdings, certificates of deposit, stocks and other sources of savings that can be liquidated quickly.
Collateral. We make both secured and unsecured loans. With a secured loan, you pledge something that you own as collateral. It might be personal assets like certificates of deposits or stocks, or business assets like real estate, inventory, equipment or accounts receivable.
