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How to Properly Write a Business Loan Request

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Have to submit a business loan request letter as part of your loan application? Not sure how to get started?

We don’t blame you. These kinds of letters aren’t as common as they used to be. While online lenders don’t usually ask for small-business loan requests, some traditional banks and credit unions still do. And if you apply for an SBA business loan (a loan backed by the US Small Business Administration), you’ll need a small-business loan request as part of your loan application package.

No matter which lender you’re applying with, this guide will help you write a strong business loan request letter―and to get the business loan you need.

How to write a business loan request letter

Start with the easy stuff
Write a brief summary
Add information about your business
Explain your financing needs
Discuss your repayment plan
Close the letter

1. Start with the easy stuff

Writing a loan request can feel overwhelming. After all, it’s not an everyday part of being a small-business owner. What do you say when applying for a bank loan? How do you write a business proposal for your loan application? What’s your lender even looking for in a business loan request letter?

That’s why we suggest starting your request writing process with the easy bits: formatting.

You’ll want to begin your business loan request with some pretty standardized formatting that includes your contact information, the date, your lender’s contact information, a subject line, and a greeting.

Typically, you’ll want to format the beginning of your small-business loan request roughly like this:

First and last name

Business’s name

Business’s phone number

Business’s address (this one is optional)

Lender name (or loan agent’s name and title, if you have one)

Contact information for your lender or loan agent

Subject line

Obviously you can simply plug in the relevant information for most of this. Easy peasy, right?

You’ll really only have to come up with your own subject line and greeting. But don’t overthink it. Something like this will work just fine for your subject line:

Re: [Your business’s name] business loan request for [loan amount]

Likewise, keep your greeting simple. “Dear [lender]” or “Dear [loan agent]” will do quite nicely.

Got all that? Then you’re ready to get into the actual loan request.

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2. Write a brief summary

Before you dive into the meat of your loan request, you should give a brief summary of your letter. Just write a short paragraph that says why you’re writing and what you want.

So you’ll probably want to include the following details:

Business name
Business industry
Desired loan amount
What you’ll use the loan for

No need to get fancy with this. You’re trying to condense the most important information into one or two sentences.

For example, your summary might look something like this:

I’m writing to request a [loan amount] loan for my small business in the [industry name] industry, [business name]. With this loan, [business name] would [describe your intended business loan use].

As you can see, you don’t need much detail here. You’re just giving the reader a quick overview of what’s to come.

And now that you’ve given them that preview, it’s time to get more in depth.

Remember, your lender isn’t here to grade your writing. Try to use good spelling, grammar, and punctuation―but don’t stress about crafting beautiful sentences.

3. Add information about your business

Your next section should add more detail about your business. You’ll want to include information like this:

Business’s legal name (if different than name used)
Business’s legal structure (LLC, partnership, S corp, sole proprietorship, etc.)
Business’s purpose
Business’s age (or date it began operating)
Annual revenue
Annual profit (if applicable)
Number of employees

Now, keep in mind that you’re not trying to give your reader an encyclopedic history of your business. Instead, you’re trying to show that you have a well-established business―one that’s solid enough to deserve a business loan. So focus on relevant details that show your business’s maturity.

You can keep this section as short as a few sentences or as long as a few (brief) paragraphs. Just make sure you leave plenty of room for the next two sections.

4. Explain your financing needs

After discussing your business, it’s time to explain why you need a bank loan.

That means you’ll want to offer some details about how you plan to use your business financing. For example, you can talk about the employees you plan to hire, the building you want to expand, or whatever else you intend to do with your term loan .

Take note, though, that you also need to explain why your loan request makes sense. Because your lender doesn’t really care that you want a loan―it cares whether or not it makes sense to lend to you. You need to convince your lender that you have a good plan for your loan―one that will make it easy to repay the money you borrow.

Try to answer questions like these as you write this section:

Why should your lender want to approve your loan application?
What happens to your business if you get your small-business loan?
What kind of growth will your business loan allow for?

Dig into your business plan and projections to find some good stats. Explain how hiring those additional employees will increase your revenue by a certain percentage or dollar amount. Break down how opening that add-on to your restaurant will allow you to seat a number of additional customers, and how much revenue you expect that to bring in.

The more specific you can get, the better. Because again, you’re trying to convince your lender that you’re borrowing as part of a thoughtful business plan ―not just because you want some cash.

And take your time with this part. In most cases, this section and the next one will form the meat of your business loan request letter.

As a rule, you should keep your business loan request letter to one page.

5. Discuss your repayment plan

By this point, your lender should understand what your business does and why a loan would help it grow. Now you need to prove to your lender that you can repay your small-business loan.

This doesn’t mean you have to show precise calculations breaking down your desired interest rate and monthly payment. (After all, your bank probably hasn’t even committed to a specific interest rate yet.)

Instead, talk about things like your business’s past finances, other existing debts, and any projections can you offer.

So if you have a profitable business, point that out, and discuss how that will free up cash flow to repay your loan. Offer summaries of profit-and-loss statements that show your business has been growing. Tell your lender how you’ll pay off that existing loan within a few months, so they don’t need to worry about it interfering with repayment of your new term loan.

Put simply, this is your chance to convince your lender of your creditworthiness. Especially if you have a slightly low credit score or some other concern, you want to use this section to show that you will absolutely repay your loan.

6. Close the letter

Finally, you can add a few finishing touches.

Usually you should close with a short paragraph or two that refers the reader to any attached documents (like financial statements) and asks them to review your loan application.

You may also want to include a sentence expressing willingness to answer any questions―or just saying you’re looking forward to hearing back.

Then end things with your signature, list any enclosed documents, and you’re done!

Well, sort of.

At this point, we strongly recommend you print off your business loan request letter and read it―out loud, if possible. This will help you catch any errors. Because no, your lender isn’t a writing teacher, but you still want to make a good impression.

Plus, if you make typos on something like your business name or desired loan amount, that inaccuracy could lead to confusion from your lender―slowing down your loan approval process.

Once you’ve proofread your loan request letter, you’re ready to submit it to your lender. With any luck, your thoughtful letter will help convince your lender to give you that loan you want.

Loan proposal letter template

So how do all those steps look when you put them together? Something like this:

First and last name

Business’s name

Business’s phone number

Business’s address (this one is optional)

Date

Lender name (or loan agent’s name and title, if you have one)

Contact information for your lender or loan agent

Subject line

Greeting

This first paragraph should summarize the rest of your letter. Keep it to just a couple sentences.

The next one to three paragraphs add more detail about your business. Include facts about its age, revenue, profit, employees, and other relevant information.

Then explain why you need financing and how you’ll use it to grow your business. This section can be a little longer (but remember your whole letter should fit on one page).

Next, talk about how your business will repay your loan. You may want to mention how financial documents show your business’s financial health, for example.

Finally, close with a short paragraph or two that list any enclosed documents and invite the lender to consider your loan application.

Printed name

List of enclosed financial documents

That’s not so hard, is it? With this basic business loan request letter template, you can easily write your own personalized business loan proposal.

The takeaway

So there you have it―that’s how to properly write a business loan request.

Get your formatting right, include a short summary, talk about your business, explain your loan needs, prove you can repay your loan, and close things off. (And don’t forget to proofread.)

We believe in you. You can write this thing.

And good luck getting your loan application approved!

Don’t just tell your lender you can repay your business loan―make sure you can with our business loan calculator .

Writing a Powerful Loan Request Letter (Free Sample)

As someone who has written numerous loan request letters for friends and clients over the years, I’ve seen firsthand what works—and what doesn’t. I’m here to guide you through the process, share insider tips, and provide templates that you can use right away.

Whether you’re seeking funds to start a business, cover medical expenses, or deal with an emergency, your loan request letter sets the tone for your application. It’s more than just a formality; it’s your chance to make a compelling case for why you deserve the loan.

Loan Request Letter Generator

Key takeaways, why a loan request letter matters.

Think of a loan request letter as your opportunity to bridge the gap between need and approval. For lenders, it shows professionalism and commitment.

For you, it’s a chance to clarify your story and make your case compelling. A poorly written or generic letter can leave doubts in a lender’s mind, but a strong, personalized one can open doors.

What Makes a Loan Request Letter Stand Out?

Clarity of Purpose : Why do you need the loan, and how will it be used?
Credibility : Demonstrate your financial responsibility with examples or supporting data.
Confidence in Repayment : A well-outlined repayment plan reassures the lender.
Tone : Show sincerity and professionalism without sounding desperate.

How to Write a Loan Request Letter: Step-by-Step Guide

1. start with a polished introduction, trending now: find out why.

Begin by addressing the lender respectfully and stating your purpose in the first paragraph. Example:

“Dear [Lender’s Name], I am writing to formally request a loan of $15,000 to expand my small business, which has shown steady growth over the past two years. This funding will allow us to purchase essential equipment and hire additional staff to meet growing demand.”

2. Explain the Need for the Loan

Be specific about why you need the funds and how they will be used. Avoid vague statements.

Example: “The $15,000 will be allocated toward purchasing a high-efficiency bakery oven and hiring a part-time pastry chef, both of which are critical for fulfilling increasing customer orders.”

3. Provide a Repayment Plan

Outline a clear repayment schedule. This reassures the lender of your commitment. Include details like monthly payment amounts, interest rate considerations, or anticipated payback time.

Example: “I propose a repayment schedule of $500 monthly over the next 36 months. This aligns with my current financial capacity and ensures timely repayment.”

4. Include Supporting Documents

Attach evidence like bank statements, business financials, or credit reports. Reference these in your letter.

Example: “For your reference, I’ve included my recent business profit-and-loss statement and projected income for the next quarter.”

5. End with Gratitude and Confidence

Express appreciation for the lender’s consideration and reaffirm your confidence in meeting the terms.

Common Mistakes to Avoid

Being Vague : Lenders need specifics to assess your request.
Neglecting a Repayment Plan : Lack of clarity here can sink your chances.
Failing to Tailor the Letter : Generic letters suggest laziness or lack of effort.
Overloading with Jargon : Use clear, simple language.

3 Unique Loan Request Letter Templates

1. template for a business loan.

Subject: Business Loan Request for Expansion

Dear [Lender’s Name],

I hope this message finds you well. I am writing to request a loan of $20,000 to expand my online boutique, [Your Business Name]. Over the past 18 months, our sales have doubled, and demand for our products continues to grow. The loan will enable us to invest in additional inventory and improve our e-commerce infrastructure to enhance customer experience.

I have attached detailed sales reports and projected growth figures for your review. My repayment plan includes monthly installments of $800 over 30 months, starting [specific start date].

Thank you for considering this request. I am happy to provide any additional documentation or answer questions you may have.

Sincerely, [Your Name]

2. Template for a Personal Emergency Loan

Subject: Urgent Loan Request for Medical Expenses

I am reaching out to request a loan of $5,000 to cover unexpected medical expenses. Recently, I faced an emergency [briefly explain situation, e.g., surgery or treatment]. This loan will help bridge the gap while I finalize reimbursement from my insurance provider.

I propose to repay the loan in 10 monthly installments of $500, starting [specific start date]. I have attached supporting documents, including the medical bills and insurance correspondence.

Thank you for your understanding and support during this challenging time.

Best regards, [Your Name]

3. Template for a Debt Consolidation Loan

Subject: Request for Debt Consolidation Loan

I am writing to request a loan of $10,000 to consolidate multiple high-interest debts into a single, more manageable payment. By doing so, I aim to reduce my financial burden and improve my credit standing.

My repayment plan is outlined in the attached document, which also includes a breakdown of my current debts and interest rates. I am confident that consolidating these loans will allow me to focus on consistent repayment.

Thank you for considering my request. Please let me know if you need further information.

Pro Tips from My Experience

Use Specific Examples : Referencing actual numbers or events makes your letter more credible.
Acknowledge Concerns : If you have a low credit score, address it upfront and explain mitigation measures.
Follow Up : After sending your letter, follow up within a week to ensure it was received and reviewed.

In conclusion, a well-written loan request letter is a vital tool in securing the funding you need. By following this guide and using the templates provided, you’ll position yourself as a trustworthy borrower. Remember: clarity, professionalism, and sincerity are your greatest assets.

Frequently Asked Questions (FAQs)

Q: what is a loan request letter.

Answer: A loan request letter is a formal document you send to a lender to request funding. It explains the loan purpose, amount, repayment plan, and demonstrates your credibility as a borrower.

Q: Why is a loan request letter important?

Answer: It personalizes your loan application and builds trust with the lender. From my experience, a well-written letter often increases approval chances significantly.

Q: What should I include in a loan request letter?

Answer: Key elements include the loan amount, purpose, repayment plan, and supporting documents. I’ve found that including specific numbers and plans makes the letter stand out.

Q: How long should a loan request letter be?

Answer: Keep it concise—usually one page is ideal. Lenders appreciate brevity and clarity, so avoid unnecessary details.

Q: Can I write a loan request letter for personal reasons?

Answer: Absolutely, personal loan requests are common for emergencies, education, or consolidating debts. I’ve helped clients successfully write for all these purposes.

Q: Should I address specific concerns in the letter?

Answer: Yes, proactively addressing concerns like low credit scores builds trust. I’ve seen lenders appreciate honesty and detailed repayment plans.

Q: What tone should I use in a loan request letter?

Answer: Be professional yet approachable. From experience, overly formal or robotic language can create a disconnect.

Q: How do I start a loan request letter?

Answer: Begin with a polite greeting and a clear statement of purpose. For instance, “I am writing to request a loan of $15,000 for my business expansion.”

Q: What supporting documents should I include?

Answer: Include financial statements, credit reports, or relevant invoices. Attaching these adds credibility and saves back-and-forth communication.

Q: Can a loan request letter help with bad credit?

Answer: Yes, if you explain why your credit is low and outline steps to improve it. I’ve seen this strategy work for many clients in tough situations.

Q: How do I explain the purpose of the loan?

Answer: Be specific about how the money will be used, such as “purchasing equipment” or “covering medical expenses.” Specificity reassures lenders about responsible use.

Q: Do I need to mention a repayment plan?

Answer: Always! Lenders want to know how and when they’ll get their money back. In my experience, a clear repayment plan is often a deal-breaker.

Q: How can I make my loan request stand out?

Answer: Personalize the letter to the lender and highlight your strengths, like consistent income or a growing business. Small details make a big impression.

Q: Is it okay to ask for a specific loan amount?

Answer: Yes, always state the exact amount you’re requesting. Being precise shows you’ve carefully calculated your needs.

Q: Can I request a loan from a friend or family member?

Answer: Yes, but approach it professionally, like you would with a bank. I’ve written letters for personal loans that preserved relationships by setting clear terms.

Q: Should I follow up after sending a loan request letter?

Answer: Definitely! A polite follow-up within a week shows initiative and ensures your letter hasn’t been overlooked.

Q: What mistakes should I avoid in a loan request letter?

Answer: Avoid vagueness, generic templates, and ignoring repayment details. I’ve seen many letters rejected because they lacked clarity or personalization.

Q: How do I address the lender in the letter?

Answer: Use their full name or title if possible, such as “Dear [Bank Manager’s Name].” Personalizing the greeting makes it more impactful.

Q: Can I write a loan request letter for debt consolidation?

Answer: Yes, and it’s a smart move to simplify payments. Clearly explain how consolidation benefits both you and the lender.

Q: How do I handle loan rejection after sending a letter?

Answer: Ask for feedback and revise your letter based on their concerns. I’ve helped clients succeed on the second or third attempt with better strategies.

Q: Should I mention collateral in my loan request letter?

Answer: If collateral is required, specify it in the letter. Lenders appreciate upfront details about assets backing the loan.

Q: Can I use a loan request letter for a business loan?

Answer: Absolutely, and it’s a critical part of the process. I’ve written letters that successfully secured funding for startups and expansions.

Q: How do I balance professionalism and personalization?

Answer: Use a formal structure but include relatable details about your situation. This balance has consistently worked well for my clients.

Q: Should I ask a professional to review my letter?

Answer: Yes, a fresh set of eyes can catch errors and suggest improvements. I often review letters for clients to ensure they’re impactful.

Q: Can templates help me write a loan request letter?

Answer: Yes, but always customize them to your situation. I’ve provided templates that serve as excellent starting points for personalization.

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