# How to Write a Business Plan for a Loan: What Underwriting Reads, in the Order It Reads It A business plan for a loan is a credit document: a one-page summary, a costed use of funds, historical financials that reconcile to your bank statements, a debt schedule and projections built from what the account already shows. Banks read it closely; many online funding providers decide on bank statements instead, so check who reads it first. [See your financing options](https://capitalgurus.com/apply/) · [Or call (725) 425-4307](tel:+17254254307) Soft credit pull only, no obligation. ## The plan in the order it gets written, from the reader to the cold read Every route is on the [small business loans](https://capitalgurus.com/) page; a plan is usually read on a bank-style [business term loan](https://capitalgurus.com/loans-and-financing/term-loans/) or a longer file. 1. Find out who reads it 2. Write the summary 3. Cost the use of funds 4. Reconcile the financials 5. Project from the statements 6. Add the payment and a bad case 7. Management and market last 8. Package the documents 9. Read it cold - One page is read first - Every figure is reconciled - Bank or SBA: several weeks to a few months - All: [Guides](https://capitalgurus.com/guides/) - Read beside it: [business loan requirements](https://capitalgurus.com/guides/business-loan-requirements/) Rates, factor rates, fees and terms are set by the funding provider that makes your offer and are disclosed in that provider's agreement. Figures on this page are illustrative ranges from providers in our network, not offers. Funding times depend on the funding provider and are subject to provider approval and document turnaround. Capital Gurus is not an SBA lender; SBA loans are made by SBA-participating lenders. ## Step 1. Do I need a business plan to get a loan? A plan has one job: let someone who has never met you decide whether the cash flow covers a new payment. On many routes nobody reads one, so the first question is who decides. | The route | Is a plan read? | What the decision turns on | | --- | --- | --- | | [SBA loans](https://capitalgurus.com/loans-and-financing/sba-loans/), 7(a) and 504 | Yes, closely | Filed returns, cash flow against the proposed payment, the use of funds, owner equity, collateral and credit | | A bank term loan or line | Yes, usually | Filed returns, interim financials, the relationship, collateral and credit | | Startup or acquisition financing | Yes, closely | The plan, the owner's experience, the projections and the figures behind the purchase | | [Working capital](https://capitalgurus.com/loans-and-financing/working-capital/) and advances | Usually not | Bank statements: deposit volume, consistency, negative days and existing debits | | Invoice factoring | Not the plan | Your customers' credit and your accounts-receivable aging report | | Equipment financing | Rarely | The asset, the application, time in business and credit | What is read varies depending on the funding provider or lender. Capital Gurus is not an SBA lender; SBA loans are made by SBA-participating lenders. **What a bank-statement file is decided on instead** On a working-capital or advance file, a provider in the network typically asks for three months of bank statements (four in CA, NY, FL and GA with some providers) and reads five things in them: deposit volume, how alike the months look and how deep the worst one is, negative days and returned items, how much of each month is already committed to other debits, and whether every month arrived whole. Nothing on that list improves with narrative. An accurate debt schedule and complete statements improve it. - **Young business** — Under two years in business: [startup business financing](https://capitalgurus.com/loans-and-financing/startup-funding/) · [the startup loan guide](https://capitalgurus.com/guides/how-to-get-a-startup-business-loan/) - **No plan** — A bank-statement product: [business loan requirements](https://capitalgurus.com/guides/business-loan-requirements/) · [improving approval odds](https://capitalgurus.com/blog/improve-business-loan-approval-chances/) - **Docs** — No filed returns or statements: [low-doc business financing](https://capitalgurus.com/solutions/no-doc/) · [business loan requirements](https://capitalgurus.com/guides/business-loan-requirements/) **What wastes time here** Writing a market analysis for a decision that will be made on your bank statements. If you need money in days rather than months, the hours go into complete statements and a one-sentence use of funds instead. **Decisions from some providers the same day, depending on the provider.** Subject to provider approval and document turnaround. [Get my options](https://capitalgurus.com/apply/) · [Call (725) 425-4307](tel:+17254254307) ## Step 2. Write the one-page summary first One page, and it exists to make the rest readable. Underwriting reads it first and checks every later number against it. 1. **What the business does** — And who pays for it, in one or two sentences. 2. **How much you are asking for** — And under which product, so the reader knows which test applies. 3. **What the money buys** — Down to the line item, matching the use of funds in step 3. 4. **What that purchase changes** — The revenue, margin or cost it moves, and when. 5. **Which cash flow repays it** — With the new payment shown as a share of a normal month. **Two sentences do more work than the rest of the page:** the use of funds and the repayment statement. If the repayment sentence is uncomfortable to write, the amount is probably wrong rather than the wording. ### Test the payment Before you write the fifth line Model the payment you expect against your weakest month of deposits rather than your average one. Run it yourself first: [business loan calculator](https://capitalgurus.com/calculators/business-loan-calculator/) How providers size a request: [how much business financing you can get](https://capitalgurus.com/guides/business-loan-amounts/) **Why write it even when no plan is read** You will be asked the same five questions on a call with a funding advisor or a provider. Having them written down, with the figures, keeps the answers consistent from the application to the agreement. ## Step 3. Cost the use of funds, line by line This is the section that can be checked against a third party before anything is funded, which is why files are won and lost here. ### The total equals the request Rule 1 A plan that asks for one figure and lists uses summing to another invites a counter-offer at the lower number. ### Working capital is a line, not a label Rule 2 Say which weeks of payroll, which inventory cycle, which seasonal gap. - **Expansion and working capital** — a label a lender has to unpick - **The supplier quote, the build-out estimate, the payroll weeks** — a list it can check ### Say what you are putting in Rule 3 Owner equity in the purchase is read as commitment, and on SBA and acquisition files it is often required. Where that applies: [do business loans require a down payment](https://capitalgurus.com/blog/do-business-loans-require-a-down-payment/) Equity requirements on SBA files are set by the participating lender under SBA rules. Capital Gurus is not an SBA lender; SBA loans are made by SBA-participating lenders. **Attach the evidence for each line** - A supplier or vendor quote for an asset - The contract or purchase order behind a receivable - The lease or purchase agreement for premises **What wastes time here** A round number with no list behind it. The underwriter rebuilds the list for you, usually smaller, and the file waits while it happens. ## Step 4. Build the debt schedule and reconcile the financials A lender does not take your financials on trust. It reconciles them, and the reconciliation is the whole exercise. ### 1. Debt schedule Prepare first - **What it shows** — Every existing obligation, its balance, payment and holder - **Checked against** — The debits visible on the bank statements ### 2. Filed business tax returns - **What it shows** — Revenue and profit a third party has already seen - **Checked against** — The returns the lender can verify ### 3. Year-to-date profit and loss - **What it shows** — This year's trading - **Checked against** — The returns, and the bank statements ### 4. Balance sheet - **What it shows** — What the business owns and owes - **Checked against** — The debt schedule and the lien searches ### 5. Bank statements - **What it shows** — What actually happened in the account - **Checked against** — Everything above **What breaks a reconciliation** - Revenue on the profit and loss that never appears as deposits - A debt schedule missing an obligation the statements show being paid - Interim figures that contradict the filed return - Personal and business money mixed in one account Each of those costs more credibility than a weak month, because each suggests the file cannot be relied on. The debt schedule is often the document that is wrong, and it is the easiest one to check, so prepare it honestly. - [the debt service coverage ratio](https://capitalgurus.com/blog/debt-service-coverage-ratio-explained/) - [financial metrics a lender computes](https://capitalgurus.com/blog/essential-financial-metrics-small-business/) ## Step 5. Project forward from the bank statements Projections are judged on the join with your current account, not on how far ahead they go. Convention is month by month through the first year, then annually across the length of the financing you are asking for. **A projection that opens well above the account's current reality is read as an error, not as ambition.** Build the bridge from the statements to the plan explicitly. One worked bridge, from what the account shows to what the plan claims. **Illustrative example, not an offer.** | | Figure | Where a lender checks it | | --- | --- | --- | | Average monthly deposits, last three months | $42,000 | Your bank statements | | The same, annualised | $504,000 | Arithmetic | | Year-one revenue in the projection | $720,000 | Your plan | | The gap you have to explain | $216,000 | Your assumptions page | | The explanation | Two new vans billing $12,000 a month each, $24,000 together, for nine months of the year | A signed contract or a pipeline a lender can verify | **The gap is not the problem; an unexplained gap is.** Every increase needs a cause a stranger can check. **Projections that survive a second reading** - One assumptions page: each growth figure, its cause, its source - Costs that grow with revenue - A first projected month close to the statements **Projections that get questioned** - A steep climb from an account that has been flat for a year - Sales that rise while cost of sales stays still - Growth with no named cause - A first month far above recent deposits ## Step 6. Put the new payment and a bad case in the model Underwriting will compute both anyway. Doing it first shows the file was built by someone who expects to repay. ### The new payment in the model Include the financing you are applying for at the payment you expect, and show what is left in a normal month and in a slow quarter. ### A downside column Show the file still works with a materially slower ramp. A plan with a bad case in it usually reads as more credible than one without. The payment you model is your estimate. Rates, fees and terms are set by the funding provider or lender that makes the offer, depending on the funding provider. **Why it matters** Underwriters compute a coverage ratio from your figures: the cash flow available against all debt payments, including the new one. If your own model never shows that line, the reader has to build it, and a figure built without you tends to be conservative. ## Step 7. Write the management and market sections last Underwriters do not start at page one. They look for the answer to one question, whether this will be repaid, and go where that answer lives. 1. **The one-page summary** — What you do, how much, what it buys, how it is repaid. 2. **The use of funds** — That the amount matches a real, costed need. 3. **Historical financials and tax returns** — That the business already produces the cash flow you describe. 4. **Bank statements and the debt schedule** — That the financials and the account agree, and what is already committed. 5. **Projections** — That the plan is arithmetically possible, and what has to be true for it to happen. 6. **Management and market** — That someone here has done this before. 7. **Collateral and guarantees** — What backs the file if everything above goes wrong. A plan written market first and numbers last tends to read as though the numbers were made to fit the story. Written in the reading order, the market section can only claim what the figures already support. On SBA files, every owner of 20% or more signs a personal guarantee under SBA rules. Capital Gurus is not an SBA lender; SBA loans are made by SBA-participating lenders. ## Step 8. Package the documents that travel with the plan The plan is the narrative; the documents are the evidence. On a file a lender reads closely, send them as one package. ### Every lender-read file - Three months of bank statements (four in CA, NY, FL and GA with some providers) - Business and personal tax returns ### Add, where they apply - Entity documents, licences and ID - Quotes or contracts behind the use of funds - SBA programme forms SBA loans usually take several weeks to a few months, subject to provider approval and document turnaround; a complete package keeps them moving. A [line of credit](https://capitalgurus.com/loans-and-financing/line-of-credit/) can bridge the wait, a cash-flow call. Capital Gurus is not an SBA lender; SBA loans are made by SBA-participating lenders. - [SBA loans](https://capitalgurus.com/loans-and-financing/sba-loans/) - [how long SBA loan approval takes](https://capitalgurus.com/blog/how-long-does-sba-loan-approval-take/) **What wastes time here** Documents sent one at a time. Missing pages are a common cause of delay, and the easiest one to avoid: collect the package before the file goes in. ## Step 9. Have it read cold, and check for what sinks a plan Give the draft to someone who has not seen it. If, after one page, they cannot say what the money buys and how it is repaid, rewrite that page. | What sinks the plan | What to do instead | See | | --- | --- | --- | | "Expansion" as the use of funds | A costed list that totals the request | Step 3 | | A steep projection from a flat account | Start from the statements and explain the gap | Step 5 | | An obligation left off the debt schedule | Check every debit on the statements | Step 4 | | No sentence on which cash flow repays it | Write the repayment statement on page one | Step 2 | | Market research in place of arithmetic | Write management and market last | Step 7 | | A plan sent where nobody reads one | Send complete statements instead | Step 1 | A plan helps a file; it does not guarantee an offer. The provider or lender makes the decision. **If the file comes back declined** ### 1. Ask which part stopped it A decline is usually about one thing, and many providers and lenders will say which. - [what to do after a decline](https://capitalgurus.com/blog/declined-for-a-business-loan-next-steps/) ### 2. Fix that one thing If the obstacle is the business credit file rather than the plan, that is a longer fix with its own steps. - [how to build business credit](https://capitalgurus.com/guides/how-to-build-business-credit/) - [common application mistakes](https://capitalgurus.com/blog/business-loan-application-mistakes/) ## Key takeaways 1. **Find out who reads the plan before you write it.** 2. **The one-page summary and the use of funds are read first, and every other number is checked against them.** 3. **A use of funds is a costed list that totals the request, with quotes or contracts attached.** 4. **Lenders reconcile rather than trust: the financials, the debt schedule and the statements have to agree.** 5. **Projections start from the account and name the cause of every increase.** 6. **Put the new payment and a downside case in your own model.** 7. **Send the documents as one complete package.** - [talk to a funding advisor](https://capitalgurus.com/contacts/) - [see your financing options](https://capitalgurus.com/apply/) ## Keep reading ### Guides - [Business loan requirements](https://capitalgurus.com/guides/business-loan-requirements/) - [How much business financing you can get](https://capitalgurus.com/guides/business-loan-amounts/) - [How to get a business loan](https://capitalgurus.com/guides/how-to-get-a-business-loan/) [Guides](https://capitalgurus.com/guides/) ### From the blog - [How to Avoid the Most Common Business Loan Application Mistakes](https://capitalgurus.com/blog/business-loan-application-mistakes/) - [Essential Financial Metrics Every Small Business Owner Should Track](https://capitalgurus.com/blog/essential-financial-metrics-small-business/) - [Understanding the Business Debt Service Coverage Ratio (DSCR) and Its Importance](https://capitalgurus.com/blog/debt-service-coverage-ratio-explained/) [Blog](https://capitalgurus.com/blog/) ## Frequently asked questions ### Do I need a business plan to get a business loan? For many online products, no: providers in Capital Gurus' network decide on bank statements, revenue, time in business and credit. A plan is usually required for SBA loans, bank loans and startup or acquisition financing, where the lender needs the use of funds, projections and the owner's experience. Capital Gurus is not an SBA lender; SBA loans are made by SBA-participating lenders. ### What should a business plan for a loan include? A one-page summary; what the business does and who buys from it; ownership and management; the market; the use of funds down to the line item; historical financials; projections with the assumptions written out; and a repayment statement showing which cash flow covers the new payment. The summary, the use of funds and the repayment statement are the parts a lender reads first. ### How long should a business plan for a loan be? Short enough that an underwriter reads all of it: one page of summary, then as many pages as the sections genuinely need, usually a modest document plus a financial appendix. Length is not evidence of effort. A long plan with a vague use of funds reads worse than a brief plan with a specific one, and narrative never replaces a reconciled number. ### Do online funding providers read a business plan? Usually not. A working-capital provider underwrites your bank statements: deposit volume and consistency, negative days, existing debits and how much revenue is already committed. Sending a plan does not hurt, but it rarely changes the outcome. Put the effort into clean, complete statements and an accurate debt schedule instead, because those are what the decision is made on. ### How far ahead should financial projections go? Month by month through the first year, then annually across the length of the financing you are asking for. What makes projections credible is their arithmetic rather than their horizon: every revenue increase traces to a named cause, and the first projected month sits close to what your bank statements already show. Include the new payment and a downside case. ### What documents go with a business plan? Typically three months of bank statements, filed business tax returns and the owners' personal returns, a year-to-date profit and loss and balance sheet, a debt schedule of every existing obligation, entity documents and government ID, plus quotes or contracts behind the use of funds. SBA programme forms are completed with the participating lender. Capital Gurus is not an SBA lender; SBA loans are made by SBA-participating lenders. ### Why would a business plan not help my application? Because it answers questions nobody asked. Underwriting wants a use of funds tied to specific costs, financials that reconcile to the statements and returns already in the file, and a repayment statement. A plan heavy on market opportunity and light on arithmetic reads as missing answers, and projections that contradict the statements cost more credibility than they build. ### Does a business plan help if my credit is weak? On a bank file, rarely enough on its own, because weak personal credit weighs heavily there whatever the plan says. On bank-statement products, credit is weighed against deposits: some providers in Capital Gurus' network consider credit from 525 with 12 months in business, and meeting a minimum does not guarantee an offer. See [business financing with bad credit](https://capitalgurus.com/solutions/bad-credit/). Still have a question? [talk to a funding advisor](https://capitalgurus.com/contacts/) Nothing on this page is financial, legal or tax advice. ## Decisions from some providers the same day, depending on the provider. Subject to provider approval and document turnaround. [Apply now](https://capitalgurus.com/apply/) · [Call (725) 425-4307](tel:+17254254307) About 5 minutes, soft credit pull only · [talk to a funding advisor](https://capitalgurus.com/contacts/) By the Capital Gurus Editorial Team · Reviewed by Joseph Wartz · [Editorial policy](https://capitalgurus.com/editorial-policy/) --- Source: https://capitalgurus.com/guides/business-plan-for-a-loan/ · Last reviewed 2026-11-09 · Capital Gurus is not a lender.