Last year was a frustrating year for small business owners who have tried to obtain credit to fund new or improved opportunities. While many small business owners try to work directly with the banker, it is important to remember that today's environment is entirely different than two or three years ago. Bankers are faced with many companies that have had a couple of unprofitable years; they now have more stringent credit policies within their banks. As such, we offer the following tips to improve your chances of getting financing for your business.

Be able to tell your story -- and with numbers. In talking with your banker, you and your team must be able to demonstrate an intimate understanding of your numbers. You can't just present a pretty business plan without being able to explain the actions to be taken and the expected results. Nail this first impression; do-overs are impossible.

Help your banker help you. Your presentation needs to include critical documents, including annual and interim financial statements, tax returns, projections of future expected results, and personal financial statements. The more complete your package, the better your odds. If you have an existing line of credit or term loans, make sure that you continue to talk with your lender about both good and bad news -- in advance if possible. Bankers don’t like surprises anymore than you do as a business owner.

Be honest and proactive. Beyond your current balance sheets, be ready to discuss your history of loan repayments. If it's good, emphasize it. If not be honest. Your candor will contribute to the lender's assessment of your character. Conscientious preparation is especially imperative if you’re approaching the lender from a position of need. Present your company as a strong, well-managed organization in a temporary slump, rather than one spiraling downward.

Be realistic. If your company has used its credit line to fund a couple of down years, your banker will be less likely to increase your credit availability. Rather, your existing obligations may be termed out. You will be able to get those facilities increased after you have shown that your company has regained profitability and is living within its means.

Don't be afraid to ask. There's more than one way to skin a cat. Ask what it will take to do what you want to do. And if you’re unable to establish a lending relationship with a conventional credit facility, you can still explore government enhancement programs (SBA 7(a) and 504 programs), subordinated debt, and additional equity sources that may help you fund growth. You may need to be creative to get financing.

Use your professionals. Whether you use them to explain results, negotiate terms, provide projections or financials, or just run interference, their experience, relationships, and credibility will help you. Remember: Relationships do matter! Our extensive financing experience has prepared us well to provide projections and financials.

Business loans are more elusive than they were even two years ago. But a smart combination of preparation and professional help can have banks bidding for your business.

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