Many small town banks are now opening up the doors for small businesses. They really want to lend you the money, but being a small bank, they want to make sure you can make it.

Most bankers have only six major questions. Answer these, and you stand an excellent chance of completing the loan. Here they are.

• HOW MUCH DO YOU NEED?
  Do your homework, and make sure you know exactly how much money you will need. Don't cut corners. Adding money for contingencies and emergencies will be considered good business, so do it! You must justify every penny, otherwise you're not prepared. That's the image your banker whats. Be prepared with a list of every cost you cah think of.

• WHAT ARE YOUR EXACT NEEDS?
  Most bankers will lend money for three reasons: to pay off old debts, to cash-in some of your personal equity, or to buy new equipment for expansion. Note that working capital is NOT a valid reason for borrowing. If you need working capital, you are probably going broke, and no banker wants to lend money to a person who is not fiscally responsible.

• WHY DO YOU NEED THE MONEY?
  Forget the platitudes, present the facts! A feasibility plan with a strong marketing and sales foundation will present your case for you . Be sure you include a risk analysis, it boggles the mind of a banker to see you do this! Consider using a marketing consultant to help with this project.

• HOW & WHEN WILL YOU PAY BACK THE MONEY?
  Use a CPA for this, not an Accountant. You need a break-even analysis that will show when you will be solvent enough to start paying back the money out of earnings rather than the money the bank lends you. Be sure the income stream you project parallels the marketing projection you've made.

• WHAT HAPPENS IF?
  Start out with this thought . . . if it can happen, it will. No matter how well you plan, glitches will happen. Because of this the banker wants insurance on his loan. He will do this by taking a second mortgage on your home, boat, car, and anything else you have of value. This should be not threat to you if you have a dynamite plan with the guts and energy to follow through; but if your plan looks weak, you're not going to get the money. Face it.

• WHY DON'T YOU ALREADY HAVE THE MONEY?
  This is a trick question, so don't let it throw you. If you had the money, you wouldn't need to borrow it; but that's not the real question. What the banker is REALLY wanting to know is whether you are fiscally responsible. If you can prove your current income is well spent with some savings, investment in something other than your business, and leave a little cash reserves, you will get the money even if you DO NOT have enough equity. Fiscal responsibility is the key.

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If you don't get the loan, you don't get the loan . . . at least from that bank. Try another, then another, then another. One thing you CAN do is start a savings program in a locally owned bank, save something EVERY payday, and next year that diligence will hel you achieve your real goal, a business of your own!