Three Reasons to Build a Relationship with a Banker Now

From Kelly Kendrick, Assistant Vice President of First Bank and Trust Company:

As a business owner, you may make several trips to the bank each week. Some of the visits may be for personal reasons like getting cash or opening up a CD but the majority of your visits are for business purposes such as depositing your sales revenues. Your interaction with bank employees may be limited to the tellers who help you with these transactions. But whom do you talk to when you need additional capital to grow your business?

Kelly Kendrick and Tyson Starting a relationship early on with a bank loan officer can have many benefits and save you mission critical time.  Here are three reasons to seek and develop a working relationship with a banker before you have a need:

1. You already have someone you trust who knows you and your business.  The benefit to you is this person understands your vision and can give you banking options that fall in line with your plan.  Your banker already knows the answers the 5Cs of Credit questions about you.

2. You can bounce ideas off of someone in the banking field as you explore options.  For example, if you’re thinking of borrowing money for your business, you and your banker can talk about the effect the new debt would have on your income statement and balance sheet, thus helping you weigh options to make an informed decision.

3. Your banker will help you to know what to expect when you do apply for a loan.  When you’re ready to apply for a loan, you will know where your company is financially and you will have all the necessary documents ready that will be requested by the bank.

Regardless of whether you’re in the market for a business bank loan or not, most bankers are willing to share advice and to support you as a fellow member of the business community.  A good relationship with a banker can be a huge advantage to you as a business owner and can play an important role in your success.

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You're invited to read about the 5Cs of Credit and more in The Basics of Business Bank Loans (.pdf) from First Bank and Trust Company.

First Bank & Trust Company was named to the Top 200 Community Banks by US Banker.  View the list in .pdf format here.

First Bank & Trust Company, one of the top community banks in the United States, is a diversified financial services firm with office locations in southwest Virginia, northeast Tennessee, and the New River and Shenandoah Valleys of Virginia.  Financial objectives are addressed by offering free checking products for personal and business accounts, and assessing lending solutions managed by mortgage, agricultural and commercial lending divisions.  Comprehensive financial solutions are available through trust and brokerage service representatives. 

For businesses, First Bank & Trust specializes in business loans, business credit, and business finance.

You're invited to read more about First Bank & Trust Company on Handshake 2.0.  First Bank & Trust Company is a client of Handshake Media, Incorporated, the parent company of Handshake 2.0.

The Essence of Good Business and Good Banking

From Kelly Kendrick, Assistant Vice President of First Bank and Trust Company:

First Bank & Trust Company was named to the Top 200 Community Banks by US Banker To help your business build a good foundation, as a business and for working with a banker, what you most need to know is where your business is financially and where you want it to go. Keeping good financial records, preparing a budget for your goals, and having room to adjust the budget based on unexpected changes will not only help you make good business decisions, but will also help you provide your banker with the right information to determine the best solutions and opportunities for your financial needs.

You’re invited to read about the 5Cs of Credit and more in The Basics of Business Bank Loans (.pdf) from First Bank and Trust Company.

First Bank & Trust Company was named to the Top 200 Community Banks by US Banker.  View the list in .pdf format here.

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First Bank & Trust Company, one of the top community banks in the United States, is a diversified financial services firm with office locations in southwest Virginia, northeast Tennessee, and the New River and Shenandoah Valleys of Virginia.  Financial objectives are addressed by offering free checking products for personal and business accounts, and assessing lending solutions managed by mortgage, agricultural and commercial lending divisions.  Comprehensive financial solutions are available through trust and brokerage service representatives.

For businesses, First Bank & Trust specializes in business loans, business credit, and business finance.

You’re invited to read more about First Bank & Trust Company on Handshake 2.0.  First Bank & Trust Company is a client of Handshake Media, Incorporated, the parent company of Handshake 2.0.

The 5 Cs of Credit

From Kelly Kendrick, Assistant Vice President of First Bank and Trust Company:

Greetings from Kelly Kendrick of First Bank & Trust Company Whether you’re seeking a business loan, a car loan or a mortgage for your home, you probably question what factors will be considered by the bank during the approval process for your loan.  The basic criteria that banks use to evaluate your loan request for approval are referred to as the 5 Cs of credit.

  1. Character – Is the customer dependable, honest, and reliable? What is the reputation of the customer? Does the customer have good credit history, indicating that they were willing to meet prior obligations?
  2. Capacity – Does the customer have adequate cash flow to repay the loan or take on additional debt?
  3. Capital – For consumer loans, what will the customer be contributing toward the purchase? For business loans, in addition to the contribution toward the purchase or the project, what has the customer invested in the growth of their company?
  4. Collateral – What is the customer offering to provide additional security and mitigate risks of the loan?
  5. Conditions – What are the current market conditions affecting the customer or their company?

The 5 Cs of credit may be a helpful tool in assessing your financial situation before you go to the bank if you may be considering applying for a loan.

You're invited to read about the 5Cs of Credit and more in The Basics of Business Bank Loans (.pdf) from First Bank and Trust Company.

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First Bank & Trust Company, one of the top community banks in the United States, is a diversified financial services firm with office locations in southwest Virginia, northeast Tennessee, and the New River and Shenandoah Valleys of Virginia.  Financial objectives are addressed by offering free checking products for personal and business accounts, and assessing lending solutions managed by mortgage, agricultural and commercial lending divisions.  Comprehensive financial solutions are available through trust and brokerage service representatives. 

For businesses, First Bank & Trust specializes in business loans, business credit, and business finance.

You're invited to read more about First Bank & Trust Company on Handshake 2.0.  First Bank & Trust Company is a client of Handshake Media, Incorporated, the parent company of Handshake 2.0.

Business Loans for Start-Ups

In Handshake 2.0’s series on business bank loans, we asked Kelly Kendrick, Assistant Vice President of First Bank and Trust Company for self-assessment questions companies could ask themselves about whether or not a bank loan would be a good fit for them, and questions to ask a business loan bank officer about the terms of the loan.

For entrepreneurs with start-up companies, we asked Kelly Kendrick, “What are three pieces of advice you would give to a start-up business on deciding whether or not to apply for a business loan?”

Kelly Kendrick answered:

The challenge that start-ups face when applying for a bank loan is that the primary source of repayment – the start-up’s business income – will not be enough to cover the loan.  Before considering applying for a business loan:

 

  1. Make sure you have thought out and have on paper a comprehensive business plan. This plan should include what your bank loan would be used for and how it would help the business grow.
  2. Invest personal equity into your company. As some like to say, “You have to have skin in the game.” A bank will be hesitant to put its money in you if you don’t put your money in first.
  3. Assess your personal financial situation.  To increase a bank considering your start-up an acceptable risk, does your financial situation offer any mitigating factors such as additional liquidity, a secondary source of income, or collateral?  If there are mitigating factors, the bank may feel more comfortable taking on the risk.

For more information, you’re invited to view The Basics of Business Bank Loans (.pdf) from First Bank and Trusty Company.

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First Bank & Trust Company, one of the top community banks in the United States, is a diversified financial services firm with office locations in southwest Virginia, northeast Tennessee, and the New River and Shenandoah Valleys of Virginia.  Financial objectives are addressed by offering free checking products for personal and business accounts, and assessing lending solutions managed by mortgage, agricultural and commercial lending divisions.  Comprehensive financial solutions are available through trust and brokerage service representatives.

For businesses, First Bank & Trust specializes in business loans, business credit, and business finance.

You’re invited to read more about First Bank & Trust Company on Handshake 2.0.  First Bank & Trust Company is a client of Handshake Media, Incorporated, the parent company of Handshake 2.0.

Applying for a Business Loan

Kelly Kendrick and Jim McAlister of First Bank & Trust Company We thank Kelly Kendrick, Assistant Vice President, and Jim McAlister, Regional Manager and Senior Vice President, First Bank and Trust Company, for their photo of a "Handshake 1.0" for Handshake 2.0!

In Handshake 2.0's series on business bank loans, we asked Kelly Kendrick for questions companies can ask themselves on whether or not a bank loan is right for them.  If a company decides to apply for a loan, we asked, "What are questions a company should ask a business loan bank officer to make sure they understand the terms of the loan?"

Kelly Kendrick answered:

  • Is the interest rate fixed (does not vary over the entire term) or is the interest rate variable (moves up and down over the term of the loan based on the changes of an underlying index)?
  • How long do I have to pay the loan back? For a line of credit, this would be when your principal portion comes due, or matures. Up until this time you may be required to make interest payments on the loan. For an amortizing loan, where your payments consist of principal and interest and the principal is paid down as you go (the loan amortizes), you will want to know the amortization period. Typically, the longer the amortization period, the smaller the principal and interest payments will be, but you may end up paying more interest over the life of the loan. The type of loan and repayment terms will depend on the purpose of the loan and the collateral which secures the loan.
  • Do the loan terms match the purpose? For example, a short-term liability should finance a short-term asset and a long-term liability should finance a long-term asset.
  • What collateral will secure the loan? Collateral offers back up support beyond the normal cash flow and lowers the risk of loss on a loan for the Bank.
  • What will happen if I pay late or can no longer repay the loan?

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First Bank & Trust Company, one of the top community banks in the United States, is a diversified financial services firm with office locations in southwest Virginia, northeast Tennessee, and the New River and Shenandoah Valleys of Virginia.  Financial objectives are addressed by offering free checking products for personal and business accounts, and assessing lending solutions managed by mortgage, agricultural and commercial lending divisions.  Comprehensive financial solutions are available through trust and brokerage service representatives. 

For businesses, First Bank & Trust specializes in business loans, business credit, and business finance.

You're invited to read more about First Bank & Trust Company on Handshake 2.0.  First Bank & Trust Company is a client of Handshake Media, Incorporated, the parent company of Handshake 2.0.

Business Bank Loan Advice from First Bank and Trust

Anne Giles Clelland, Handshake Media, and Kelly Kendrick, First Bank and Trust Company
Anne Giles Clelland, CEO of Handshake Media, and Kelly Kendrick, Assistant Vice President of First Bank and Trust Company, share a handshake.

Handshake 2.0 asked Kelly Kendrick, "What are three questions companies can ask themselves to decide whether or not a business loan from a bank might be right for them?"

Kelly Kendrick answered:

  1. Do I really need a loan? For example, are my sales increasing rapidly, causing the need for expansion? Do I need to upgrade to keep up with competition? 
  2. What other financing options other than bank loans may be available for my business? For example, alternative options to financing your business through a bank are venture capitalists, grants, gifts or contributions from family members, or accepting private equity investment. 
  3. Do I have enough extra income to repay the loan? For example, what loan amount do I need and what will the payments be to repay the loan?

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Photo credit: Mary Anne McElmurray

First Bank & Trust Company, one of the top community banks in the United States, is a diversified financial services firm with office locations in southwest Virginia, northeast Tennessee, and the New River and Shenandoah Valleys of Virginia.  Financial objectives are addressed by offering free checking products for personal and business accounts, and assessing lending solutions managed by mortgage, agricultural and commercial lending divisions.  Comprehensive financial solutions are available through trust and brokerage service representatives. 

For businesses, First Bank & Trust specializes in business loans, business credit, and business finance.

First Bank & Trust Company is a client of Handshake Media, Incorporated, the parent company of Handshake 2.0.