How You Write It Can Help or Hurt Your Approval Chances
Lenders can sometimes take longer than expected to approve or deny funding requests, and this can be frustrating for a business owner who desperately needs those funds. After a while, you may even start wondering whether or not the lender received your application at all.
While you may feel as if your hands are tied, there is something you can do: write a follow-up letter to check on the status of the application.
The Challenge of Writing a Follow-Up Letter
How you craft the follow-up letter can have an impact on whether or not you are approved for your loan. A well-written follow-up letter will show the lender that you have initiative, and you can use this correspondence to remind the lender of your business’s strengths.
Each of these aspects can help improve your approval chances. But, a poorly-written follow-up letter may have you coming off sounding desperate or overly pushy, and this could be detrimental to your approval chances.
Here are four tips to writing a proper follow-up letter, so you have the best chance possible of being approved for funding.
#1 – Confirm Receipt of Your Application
If you applied for funding online, or sent an application through the mail, then give the lending institution a call to confirm that your application has been received. You can also ask approximately how long their approval process takes.
Collect the name and contact information for the person responsible for determining funding requests before you get off the phone.
#2 – Wait Enough Time Before Writing a Follow-Up
In most cases, if you have not heard back within two weeks, then you should send out a follow-up letter. Keep in mind the timeframe your lender told you it normally takes.
Sending a follow-up immediately after the approximate timeframe has expired will look pushy. The approval officer may have been off a day or two, so be patient, and allow enough time to pass before sending a follow-up.
#3 – How to Format Your Follow-Up Letter
Your funding request follow-up letter should be written on letterhead that includes your business name and contact information centered on the page. The recipient’s name and contact information should be next, aligned to the left, followed by the date.
The letter should begin with a professional greeting that includes the individual’s name and title, with the greeting punctuated by a colon at the end, instead of a comma. For example:
Dear Mr. Chet Wisdom, Loan Director at National Bank:
#4 – Writing the Body of the Letter
The body of your letter should start off by thanking the lender for considering your request for funding. Next, you should cite your initial request, including the case or confirmation number, if it was assigned one. This will allow the recipient to easily find your request, should they need to locate it.
Follow this by reiterating your business’s strengths, utilizing bullet points where necessary, to highlight key points. If any positive developments have transpired since your original application, such as more favorable marketing data regarding your business or industry, then you can make the recipient aware of them at this time.
Keep the tone positive, but be careful you do not come off as if you are already approved.
Wrap up the body of the letter by inquiring about the next step of the application process. Ask how and when the applicants will be notified about their loan determinations.
Finally, close the letter with “Sincerely,” aligned to the left side of the page; if you are sending a physical letter instead of an email, sign it in ink.
Email or Snail Mail?
Sending a physical letter via “snail mail” can sometimes pull a little more weight with lenders, simply because it is much more personal. It shows you took more time and effort to craft and send your letter.
But, if you want the letter to get there immediately, then email is the way to go. Just remember, if you are sending an email follow-up for a funding request, it still needs to be written and formatted as professionally as a physical letter.