This is part of a series of ongoing blogs created by Advantage+ to help business owners like you better manage their companies – and get more out of life.

Making a Statement

Want to impress a business lender? Providing a detailed personal financial statement will put your best foot forward.

 By Larry Elton, Advantage+ chief executive officer

An old adage says you never get a second chance to make a good first impression. That holds true for many things in life – including getting approved for a business loan.

Look at it this way: Would you go into a job interview with an incomplete resume and no references in hand? Or visit a doctor for the first time without a list of prescriptions you take and details about your medical history? (Unless, of course, you prefer unemployment and poor health.)

Meeting with a lender for the first time is no different. And to get a loan approved, one of the best tools at your disposal is a document known as a personal financial statement (PFS). Think of it as a statement about your financial health – a business blueprint of sorts that shows things such as what you own, what you owe, what you earn and what you’re worth. Why is this important? Well, the typical small-business owner doesn’t get his or her financial statements audited by outside accountants. As such, banks and other lenders rely on a business owner’s personal guarantee – and a supporting PFS, which helps lenders evaluate a borrower’s personal liquidity and financial strength.

Now, if you Google the words “personal financial statement,” you’ll find thousands of free templates. But there’s no need to panic or feel overwhelmed; they all ask for the same basic information. (To make it easier for you, just click here to print out your own PFS).

Here’s another thing to consider: A PFS is no one-trick pony. Sure, it’ll help you get a loan. But just as importantly, it will also help you obtain a lender’s best interest rates and terms. Moreover, it also serves as a valuable tool for helping small-business owners track their personal financial progress. In addition, it’ll show where you might be unknowingly co-mingling personal and business finances – a no-no in the eyes of many lenders.

As you prepare to fill out this important document, here are some tips to keep in mind:

  • Make it complete. Include everything you own and everything you owe, including even credit card debt.
  • Make it neat. When it comes to filling out a PFS, legibility earns credibility. A professional-looking PFS suggests you are conscientious, intelligent and reliable. A sketchy and sloppy PFS suggests you just might be lazy and inattentive to details.
  • Make it conservative. List the value of your business at a legitimate book value (net worth), not what you wish it was worth.

As for the nitty-gritty details about completing the form, you can perform an Internet search for information about how to fill out a PFS. You’ll find credible sites like this one. So go ahead – print out that PFS. And get ready to make that very important good first impression.

Are you befuddled by the world of small-business loans? I’m here to help. To send us comments and ideas for future blogs, just send me an email at or call me at 1-800-949-7040.